[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]



                         [H.A.S.C. No. 110-65]
 
             EXPEDITIONARY FIGHTING VEHICLE PROGRAM UPDATE

                               __________

                                HEARING

                               BEFORE THE

             SEAPOWER AND EXPEDITIONARY FORCES SUBCOMMITTEE

                                 OF THE

                      COMMITTEE ON ARMED SERVICES

                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                              HEARING HELD

                             JUNE 26, 2007

                                     
[GRAPHIC] [TIFF OMITTED] 

                                     


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             SEAPOWER AND EXPEDITIONARY FORCES SUBCOMMITTEE

                   GENE TAYLOR, Mississippi, Chairman
NEIL ABERCROMBIE, Hawaii             ROSCOE G. BARTLETT, Maryland
JAMES R. LANGEVIN, Rhode Island      KEN CALVERT, California
RICK LARSEN, Washington              TERRY EVERETT, Alabama
MADELEINE Z. BORDALLO, Guam          JO ANN DAVIS, Virginia
BRAD ELLSWORTH, Indiana              J. RANDY FORBES, Virginia
JOE COURTNEY, Connecticut            JOE WILSON, South Carolina
JOE SESTAK, Pennsylvania
                  Will Ebbs, Professional Staff Member
                 Heath Bope, Professional Staff Member
               Jenness Simler, Professional Staff Member
                    Jason Hagadorn, Staff Assistant


                            C O N T E N T S

                              ----------                              

                     CHRONOLOGICAL LIST OF HEARINGS
                                  2007

                                                                   Page

Hearing:

Tuesday, June 26, 2007, Expeditionary Fighting Vehicle Program 
  Update.........................................................     1

Appendix:

Tuesday, June 26, 2007...........................................    29
                              ----------                              

                         TUESDAY, JUNE 26, 2007
             EXPEDITIONARY FIGHTING VEHICLE PROGRAM UPDATE
              STATEMENTS PRESENTED BY MEMBERS OF CONGRESS

Bartlett, Hon. Roscoe G., a Representative from Maryland, Ranking 
  Member, Seapower and Expeditionary Forces Subcommittee.........     3
Taylor, Hon. Gene, a Representative from Mississippi, Chairman, 
  Seapower and Expeditionary Forces Subcommittee.................     1

                               WITNESSES

Ahern, David G., Director, Portfolio Systems Acquisition, Office 
  of the Deputy Under Secretary of Defense (Acquisition and 
  Technology); Roger M. Smith, Deputy Assistant Secretary of the 
  Navy (Expeditionary Warfare), accompanied by Col. William 
  Taylor, Program Executive Officer Land Systems (PEO LS), U.S. 
  Marine Corps; Lt. Gen. Emerson N. Gardner, Jr., Deputy 
  Commandant, Programs and Resources Department, Headquarters, 
  U.S. Marine Corps beginning on.................................     5

                                APPENDIX

Prepared Statements:

    Ahern, David G...............................................    33
    Gardner, Lt. Gen. Emerson N., Jr.............................    51
    Smith, Roger M., joint with Col. William Taylor..............    42

Documents Submitted for the Record:
    [There were no Documents submitted.]

Questions and Answers Submitted for the Record:

    Mr. Forbes...................................................    63
    Mr. Taylor...................................................    59
             EXPEDITIONARY FIGHTING VEHICLE PROGRAM UPDATE

                              ----------                              

                  House of Representatives,
                       Committee on Armed Services,
            Seapower and Expeditionary Forces Subcommittee,
                            Washington, DC, Tuesday, June 26, 2007.
    The subcommittee met, pursuant to call, at 4:04 p.m., in 
room 2212, Rayburn House Office Building, Hon. Gene Taylor 
(chairman of the subcommittee) presiding.

 OPENING STATEMENT OF HON. GENE TAYLOR, A REPRESENTATIVE FROM 
   MISSISSIPPI, CHAIRMAN, SEAPOWER AND EXPEDITIONARY FORCES 
                          SUBCOMMITTEE

    Mr. Taylor. The committee will come to order.
    The purpose of this afternoon's hearing is to receive 
testimony from representatives of the Department of Defense 
(DOD), the Department of Navy, and the Marine Corps on the 
status of the Expeditionary Fighting Vehicle (EFV) program, 
which recently completed an extensive review triggered by 
program delays and significant cost growth.
    The hearing will consist of one panel: Mr. David Ahern, 
Director of Portfolio Systems Acquisition, Office of the Under 
Secretary of Defense for Acquisition, Technology and Logistics; 
Mr. Roger Smith, Deputy Assistant Secretary of the Navy for 
Expeditionary Warfare; Lieutenant General Emerson Gardner, 
Deputy Commandant of the Marine Corps, Programs and Resources; 
and Colonel William Taylor, Program Executive Officer, Marine 
Corps Land Systems.
    The program under review today, the Expeditionary Fighting 
Vehicle, was conceived in the mid-1990's, but its primary focus 
is an enduring Marine Corps mission: getting Marines from ship 
to shore and then helping them fight on land.
    The ancestor of the EFV is the amphibious tractor or 
AMTRAC, first developed during World War II to get Marines 
ashore while providing limited protection and firepower 
support.
    However, compared to the original AMTRAC, the EFV seeks to 
make a dramatic step forward. The role of this program is to 
build an armored personnel carrier with a 30-millimeter cannon 
that can launch from ships 25 miles offshore and approach at 25 
knots carrying 17 Marines--a daunting technical challenge.
    Building armored combat vehicles for today's combat 
environment, a threat that can come from any direction at 
anytime is hard enough. Building one that can go 25 knots in 
the water is an order of magnitude more difficult.
    From the start of the program in 1995 until late 2006, the 
Marine Corps and its prime contractor, General Dynamics, 
appeared to be making good progress toward low-rate production 
in 2007. The Marine Corps and the contractors reported that the 
EFV prototypes were meeting all their performance goals. 
Congress, for its part, provided strong support for the EFV 
through defense authorization and appropriations legislation.
    Then something apparently went wrong. Last fall, the Marine 
Corps program manager raised concerns about the lower 
reliability of the EFV prototypes undergoing developmental 
testing. The production version of the EFV is supposed to be 
able to operate about 43 hours before breaking down. The 
prototypes being tested were only going between 4 and 10 hours 
before breaking down, and there were many different systems in 
the EFV with reliability issues.
    I want to be very clear what this kind of reliability 
problem can mean for Marines who operate these vehicles. Going 
into combat in armored vehicles that float is dangerous enough. 
If that same vehicle gets ashore far from the nearest 
maintenance support and breaks down, the Marines on that 
vehicle could be extremely vulnerable.
    It is clear that a reliable vehicle is a must, and while I 
am disappointed and troubled that the prototypes performed so 
poorly after U.S. taxpayers provided more than $2.3 billion in 
funds, my concern is tempered somewhat by the fact that the 
Marine Corps noticed these reliability problems with the 
prototypes supplied by the contractor and are trying to do 
something about it now, rather than waiting until the vehicles 
are in the hands of the Marines.
    After these reliability problems arose, another major 
decision was made by the Marine Corps, which changes the 
program originally authorized by this Congress. Rather than 
buying more than 1,000 EFVs as originally planned, the Marine 
Corps was directed to only purchase 573.
    Obviously, when you cut the number of vehicles in half, 
each one is going to cost more. In this case, the cost of a 
single EFV went from $6 million a copy to $17 million, which I 
would believe would make the EFV the most expensive ground 
combat vehicle in the history of the U.S. military.
    The combination of this dramatic cost growth and 
reliability problems triggered a Nunn-McCurdy review of the EFV 
program by the secretary of defense. The results of that review 
are the primary focus of this hearing. The Nunn-McCurdy review 
decided to keep the program going but with a four-year delay 
and numerous additional oversight.
    While there are many important technical and financial 
issues involved in a major program like EFV, I am particularly 
concerned about DOD's decision to award another contract for 
continued development of the EFV to the same contractor, 
General Dynamics, whose poor performance led in part to the 
delays and cost overruns of the EFV program.
    I am concerned about what kind of message this sends to the 
public and to those in the defense industry. An observer might 
reasonably ask why a contractor should get $82 million in award 
fees for a program that did not perform as promised and then 
get, in effect, a four-year contract extension that will be 
worth millions more.
    At a minimum, the committee expects the panel of witnesses 
today to address the following issues: Why does the Marine 
Corps need this vehicle? What is the net gain in amphibious 
assault capability that the EFV will provide? What happened? 
Why did a program that appeared to be moving along on schedule 
suddenly encounter serious reliability problems? Were there 
warning signs and were they ignored? Who was responsible for 
the program getting so far off track? What actions did they 
take to try to fix the problems when they arose?
    Why did the DOD agree to let the Marine Corps keep the same 
contractor in place whose poor performance led, at least in 
part, to things going wrong? Why not run a new competition so 
that another company can get involved? Have lessons learned 
been captured, and is there a mitigation plan in place that 
would ensure that these problems will not occur again in the 
future?
    Congress has an oversight responsibility to the American 
taxpayer. There are few programs of which I am aware that 
actually meet their cost and schedule goals. That must change. 
This committee and this Congress understand that advanced 
combat vehicles like the EFV represent difficult engineering 
challenges and are not easy to build. However, effective 
program oversight, sound engineering and program maintenance 
policies are supposed to manage that risk.
    Congress cannot continue to just throw money at problems as 
they overrun projections. There needs to be more accountability 
and more openness across a wide range of acquisition projects. 
This is just one.
    Finally, before turning to our Ranking Member, 
Representative Roscoe Bartlett, I wanted to point out that one 
of our witnesses, Lieutenant General Gardner, has been 
nominated by the President to serve as Deputy Director of 
Program Analysis and Evaluation in the Office of the Secretary 
of Defense (OSD). If confirmed, he will be the first Marine in 
this very important position.
    The committee wishes him well with his Senate confirmation 
and new responsibilities.
    I would now like to recognize the Ranking Member of this 
committee and my partner in trying to solve some of these 
problems, Representative Roscoe Bartlett.

  STATEMENT OF HON. ROSCOE G. BARTLETT, A REPRESENTATIVE FROM 
  MARYLAND, RANKING MEMBER, SEAPOWER AND EXPEDITIONARY FORCES 
                          SUBCOMMITTEE

    Mr. Bartlett. Thank you, Mr. Chairman.
    Good afternoon, ladies and gentlemen.
    I have followed the progress of the Expeditionary Fighting 
Vehicle with interest, especially because the program falls 
within the jurisdiction of this subcommittee. Clearly, this 
vehicle is a one-of-a-kind marvel. Comparisons to other ground 
vehicles are unproductive.
    The Expeditionary Fighting Vehicle has demonstrated it can 
keep up with the M1 Abrams tank on land, but can the Abrams 
tank be launched from a ship and do more than 25 knots to 
shore?
    Many comparisons to other amphibious assault capabilities 
are poor. The V-22 tilt-rotor aircraft is designed for 
amphibious assault, but the V-22 doesn't have a 30-millimeter 
cannon and doesn't protect the Marines inside from most 
nuclear, chemical, or biological attacks.
    The amphibious assault vehicle, or AAV, that the Marines 
have had in inventory since the 1970's provides amphibious 
assault from the sea, but the AAV is over 75 percent slower and 
can only be launched from two nautical miles out, as compared 
to 25 nautical miles that the EFV has, and the AAV's range on 
land is 40 percent less than the EFV.
    But the EFV program does have one striking similarity to a 
number of other Pentagon programs. It has been unable to stay 
on cost and on schedule. The EFV still has a number of 
technical hurdles to overcome. Like several of EFV's sister 
acquisition programs in the Navy and Marine Corps, the program 
is not just a little over budget and over schedule. This 
program is going to cost more than three times what Congress 
was originally informed.
    If all goes well from here on out, system development and 
demonstration is going to take nearly twice as long as 
originally planned. What is even more troubling perhaps is that 
the reasons for the cost and schedule growth are also quite 
similar to other acquisition programs.
    For example, at least two reviews of the program have found 
that there was a lack of systems engineering experience at both 
the government and contractor levels. Further, the schedule for 
the program was unrealistic, with design reviews that were held 
even when the contractor was not ready.
    The level of effort on the program was not properly 
adjusted to reflect funding realities. There was not sufficient 
emphasis on developmental testing and the test and evaluation 
master plan was not properly developed.
    One of the requirements appears to have been the major 
design drive, and consequently it was a major driver in the 
reliability, costs, and schedule issues. Yet at no point does 
there appear to have been consideration made for adjusting this 
requirement and spiraling an additional capability at a later 
date.
    As well, despite these programmatic challenges, it would 
appear that the contractor continued to earn the majority of 
the award fee associated with the program. There is a 
disturbing familiarity here. It almost sounds like we could 
replace the name EFV with the name of other major acquisition 
programs and we would be dealing with a lot of the same issues. 
In this very room, we have had hearings to discuss nearly 
identical issues on LCS and DDG-1000. Many of these same 
challenges face V-22.
    I have listened to our road fighters tell me that the 
capabilities that EFV can help fill a critical gap. I hope we 
will hear more about that today to assure our members that this 
is not simply a program that the Marine Corps feels it has to 
have because it is time to replace the AAV, but rather the EFV 
provides capabilities we need for tomorrow's battle space.
    However, this pattern of cost overruns, schedule delays and 
apparent lack of accountability has got to stop. These are 
serious systemic problems. I want to hear some serious systemic 
answers. As a result of this re-certification, what are you 
going to do to fix the specific issues encountered on EFV and 
what are you going to do to start re-learning this lesson?
    I thank the witnesses for being with us to discuss these 
issues, and I thank them for their service.
    Thank you, Mr. Chairman.
    Mr. Taylor. Thank you, Mr. Bartlett.
    Without objection, all prepared witness statements will be 
accepted for inclusion in the record.
    Mr. Ahern, I understand that you have an opening statement, 
to be followed by Mr. Smith and Lieutenant General Gardner.

   STATEMENT OF DAVID G. AHERN, DIRECTOR, PORTFOLIO SYSTEMS 
 ACQUISITION, OFFICE OF THE DEPUTY UNDER SECRETARY OF DEFENSE 
(ACQUISITION AND TECHNOLOGY); ROGER M. SMITH, DEPUTY ASSISTANT 
 SECRETARY OF THE NAVY (EXPEDITIONARY WARFARE), ACCOMPANIED BY 
  COL. WILLIAM TAYLOR, PROGRAM EXECUTIVE OFFICER LAND SYSTEMS 
(PEO LS), U.S. MARINE CORPS; LT. GEN. EMERSON N. GARDNER, JR., 
     DEPUTY COMMANDANT, PROGRAMS AND RESOURCES DEPARTMENT, 
                HEADQUARTERS, U.S. MARINE CORPS

                  STATEMENT OF DAVID G. AHERN

    Mr. Ahern. Thank you, Chairman Taylor. I have a very brief 
opening statement.
    Chairman Taylor, Ranking Member Bartlett and members of the 
subcommittee, I am honored to have the opportunity to discuss 
the Department's recent Nunn-McCurdy certification of the 
Marine Corps restructured Expeditionary Fighting Vehicle 
pursuant to the requirements of section 2433 of the Title X 
United States Code.
    Your letter of 6 June requested that OSD, AT&L, address 
three specific issues: a description of the Nunn-McCurdy review 
process; an explanation of the outcome from that process; and 
any initiatives the Department is pursuing to avoid similar 
challenges in other acquisition programs.
    I have submitted a written statement that addresses those 
three issues, and I am prepared to further discuss how the 
Department addressed those issues this afternoon.
    Before completing my opening statement, I would like to 
mention that in order to have successful execution of the 
certified EFV program, it is contingent upon receiving the full 
funding requested in the fiscal year 2008 President's budget.
    I thank the committee for your time today and leadership in 
addressing the Marine Corps' operational needs. The committee 
has consistently provided our men and women in the armed forces 
with systems and support they need.
    Thank you for your unwavering support, and I would be happy 
to take any questions on those issues and the other issues that 
you mentioned, sir.
    Mr. Taylor. Mr. Ahern, with all due respect, I don't recall 
you answering a single question that we just asked you.
    Mr. Ahern. Yes, sir.
    Mr. Taylor. I hope you know that in this subcommittee, we 
regularly waive the five-minute rule to give our witnesses the 
opportunity to answer questions. This isn't for show; this is 
dead-serious. I want to give you a second opportunity to answer 
the questions that the committee just asked of you.
    Mr. Ahern. Yes, sir.
    Mr. Taylor. And do it in any manner that you wish.
    Mr. Ahern. In discussing the review process and the lessons 
learned, I would say that we learned most specifically, the 
Department's initiatives focused primarily on starting the 
programs correctly, that we have the right balance of 
requirements, acquisition planning, including technological 
maturity, and funding. If we do that at the beginning of a 
program, we stand a much better chance of having that program 
proceed successfully.
    Second, we have to have a very robust ability to frame 
markers for early intervention for troubled programs prior to 
breaches, ensuring that systems engineering processes 
specifically--and I think we have done that in the EFV program 
with the restructured schedule the way it is laid out--and 
contract performance management systems, and I think we have 
done that also with the recertification effort of the earned 
value management system (EVMS) of General Dynamics, and a focus 
on using the earned value management by the program office, 
that they are fully utilized as key elements in indicating the 
status of the program.
    We are conducting a rapid review of all the major 
acquisitions to identify any problem programs for early 
attention based on our experience in this Nunn-McCurdy process 
in 2007. Additionally, we are working to identify the effective 
cost goals indicators for early acquisition program course 
correction, and initiatives to improve acquisition processes 
continue to be a department priority.
    That, from the standpoint, as I understood your question, 
sir, addresses the questions of the lessons learned from the 
Nunn-McCurdy certification of the earned value management of 
the EFV.
    [The prepared statement of Mr. Ahern can be found in the 
Appendix on page 33.]
    Mr. Taylor. Mr. Ahern, we will proceed in the regular 
order, but I would hope that for the benefit of everyone 
concerned, starting with the Marines who will be riding in 
these vehicles, their parents, their loved ones, the taxpayers 
that are going to pay for these, and who have paid $2.3 billion 
to date for an uncompleted program, that we will get some 
better answers later on during the course of this hearing.
    The chair now recognizes Mr. Smith.

                  STATEMENT OF ROGER M. SMITH

    Mr. Smith. Mr. Chairman, Mr. Bartlett and distinguished 
other members of the subcommittee, I thank you on behalf of our 
sailors and Marines to appear before you today to discuss the 
current status of the EFV, its restructuring following the 
Nunn-McCurdy certification process, and the Office of the 
Secretary of Defense's approved way ahead for the program.
    Today, I will provide a joint statement, and I have Colonel 
Bill Taylor with me, our new Marine Corps Program Executive 
Officer (PEO) for land systems. We are going to provide the 
Department of Navy's testimony on the programmatic and 
technological factors that led to the EFV's reliability issues 
in 2006, the outcome of the program's Nunn-McCurdy 
certification, and the restructuring and management initiatives 
the Department has implemented to ensure that we progress on a 
successful track to fill this capability.
    In the interest of time, I will close by saying the EFV is 
the top priority program of the Department of Navy, or is a top 
priority program of the Department of Navy, and it is the most 
cost-effective way ahead as far as a restructured program, and 
will provide the Marine Corps the capability to perform its 
Title X mission of projecting combat power from the sea in an 
increasingly anti-access security environment.
    EFV's ability to maneuver at speeds in excess of 25 knots 
through the water, combined with its superior land-ability, 
lethality and survivability, will provide both over-the-horizon 
amphibious capability and significantly greater warfighting 
power projection on land than the current amphibious assault 
vehicle.
    I look forward to your questions.
    Mr. Taylor. Mr. Smith, I am going to say the same thing to 
you. The program spent $2.3 billion. Apparently, the vehicles 
can't go but a few hours between major breakdowns. It is not 
ready to be fielded after all this money. You have just given a 
contract to the contractor who has apparently had serious 
problems. You haven't told me how you are going to redress 
them.
    You have not done a good justification of where $2.3 
billion went. As far as I am concerned, you have done nothing 
to promote the purpose of this vehicle, which is to make it 
safer for the amphibious assaults. You have to be further 
offshore to get the Marines to the battle safely, and then get 
them home safely.
    The purpose of this is not to waste your time or our time, 
but to explain to the moms and dads and loved ones of those 
Marines what we are doing and to the citizens who are paying 
for this. Would you like another chance at answering some of 
the questions the committee has supplied to you?
    Mr. Smith. Absolutely. I was given the guidance to provide 
a short opening statement, and I will address your questions, 
sir.
    Mr. Taylor. With the consent of the committee members, we 
think that what you have to say is important enough to where we 
regularly waive the five-minute rule. And so with unanimous 
consent, I would ask to do that today.
    Without objection.
    Mr. Smith. All right, sir. Some of the problems that led to 
the poor reliability was that the program was not fully funded 
in the 1990's, leading up to deferred systems engineering. And 
then the deferred systems engineering that was not performed in 
the latter part of the program, in the systems development and 
demonstration timeframe, created a situation where we did not 
fully understand when we corrected some part of the program 
content from testing, something else perhaps was not addressed.
    Our developmental test that was conducted did not 
adequately identify the poor reliability in a number of the 
systems. The vehicle did pass or did demonstrate all of its key 
performance parameters with the exception of reliability during 
the operational assessment. However, it could not do it 
consistently, as you have addressed.
    We have through four different independent assessments 
determined that the lack of systems engineering that was not 
performed is one of the main factors that caused the 
reliability to be so poor.
    Do you have anything to add, Bill?
    Colonel Taylor. No, sir.
    [The joint prepared statement of Mr. Smith and Colonel 
Taylor can be found in the Appendix on page 42.]
    Mr. Taylor. General Gardner, would you like to make your 
statement?

         STATEMENT OF LT. GEN. EMERSON N. GARDNER, JR.

    General Gardner. Yes, sir. I would like to answer the first 
two of your questions. First, Chairman Taylor, Congressman 
Bartlett, distinguished members, thank you for the opportunity 
to be here and thank you for your well wishes, sir.
    Why do we need the EFV? The EFV is essential to the 
Nation's forcible entry capability, a capability that carries 
strategic weight in this dangerous world. Our concept of 
projecting power is to use a triad of Marine tilt-rotor and 
rotor-wing aircraft, Navy landing craft air cushions, LCACs, 
and the EFV, to achieve speed and sustainable power ashore. 
Without the EFV, the United States does not have the ability to 
conduct surface assaults from ships over the horizon.
    The necessity of over-the-horizon operations was reinforced 
about a year ago when Hezbollah rebels used an Iranian missile 
to successfully engage an Israeli patrol boat about ten miles 
offshore of Lebanon. If we Marines were told today to perform 
our primary mission of forcible entry from the sea, Navy ships 
would have to operate well within the range of those kinds of 
coastal defense. Rapidly acquiring the EFV will reduce the risk 
of casualties and the loss of ships.
    I believe that answers your question, sir, about the need 
and the net gain in capability.
    We believe that the acquisition community within OSD as 
represented at the table today has restructured the EFV program 
in a way that will give us the high-speed amphibious capability 
that we need. As the final piece to our long-sought triad of 
forcible entry capability, we seek the support of the Congress 
in fully resourcing this program in fiscal year 2008 and the 
years to come.
    Thank you.
    [The prepared statement of General Gardner can be found in 
the Appendix on page 51.]
    Mr. Taylor. Thank you, General.
    General, the first question will be, how practical is it? 
It seems to me it would be great to have a vehicle that can do 
26 knots in the water speed with equal survivability. But how 
practical is that to couple with a vehicle that is going to go 
several hundred miles inland?
    And the next question is, given the enemy's unfortunate 
exploitation of the Humvee, and their continued improvements in 
the use of mines, particularly from below a vehicle, how well 
protected is this vehicle if we solve the technical problems on 
the breakdowns? How vulnerable will it be to mines from 
underneath? And is that being taken into account?
    Nowhere have I read that that was one of the initial goals, 
and that is forgivable because we didn't see this coming with 
the Humvee. We didn't see it coming with the Bradley. South 
Africa saw it ten years ago, but we, is the word, did not see 
this coming. But we see it now, and we are taking steps with 
the Mine Resistant Ambush Protected Vehicle (MRAP) now.
    So what steps are being taken, once we solve the mechanical 
problems and the breakdown problems, how susceptible to mines 
from beneath will this vehicle be? And has that been a part of 
the testing?
    General Gardner. Sir, let me try and take those in order.
    First, you know, the Marine Corps is a balanced force. We 
are a multi-mission force, and we have to be organized, 
trained, and equipped to do a multitude of missions. This is 
one of the reasons that we embarked on looking at our portfolio 
of armed vehicles here and reduced the overall objective from 
1,013 EFVs to 573.
    At the same time, we decided to balance our portfolio by 
seeking in the future about 600 or so wheeled vehicles, armored 
vehicles, which will then together provide the kind of 
capability you would need ashore, but still provide us this 
forcible entry capability from the sea.
    So I would say that the EFV provides this niche. It is the 
only machine in the world that provides that capability, so 
zero is clearly the wrong answer. As we looked at the mission 
sets and what we saw in the strategic planning guidance, we 
felt that 573 was the right number to properly equip and 
position assets on prepositioned ships, and in training assets.
    So I think that goes after what you are talking about, is 
it practical to do that. We need that capability. When we are 
standing offshore from the forcible entry requirement, we need 
the ability to go both air and surface, or some mix, according 
to the situation at the time, and this provides that.
    With regard to the protective capabilities, I think maybe 
Colonel Taylor or Mr. Smith is maybe better postured to answer 
the specific attributes of the vehicle, but we recognize that 
there must be certain trades made when you are trying to get 
all of these capabilities to provide the overall capability to 
the Marine Corps.
    To provide this kind of high-speed capability that we need 
to be able to get up on plane, we need a flat-bottom vehicle, 
and flat-bottom vehicles are not ideally suited for damage 
control against buried mines. However, the side protection of 
the vehicle does provide the kind of force protection that we 
are seeing in the vehicles today.
    Perhaps Colonel Taylor----
    Colonel Taylor. Yes, sir, Mr. Chairman. Again, as General 
Gardner mentioned, this is sub-optimized as compared to some of 
the pure combat vehicles once ashore, but because of the 
requirement to have that flat bottom so that it can get up on 
plane, that is a driving factor in being sub-optimized. But 
even once ashore, it does compare favorably to purely ground-
based combat vehicles such as Strykers. So it does satisfy its 
firepower, armor protection KPPs.
    Mr. Taylor. About two years ago right now, one of your 
AMTRACs out in Anbar Province, with a number of Marines on 
board, was attacked by an extremely powerful device from 
underneath. Some of the Marine Corps reservists on that AMTRAC 
were from Mississippi. They were a bit more fortunate than 
their counterparts from Louisiana Marine Corps Reserves. That 
certainly left a lasting impression on a lot of people in that 
part of the world.
    If this vehicle were to encounter that same device, number 
one, has anyone run any tests like that? And I guess the follow 
up would be, if a test has been run, would it be any more 
survivable than that AMTRAC was on that day two years ago?
    Colonel Taylor. Mr. Chairman, I think I would answer the 
question in this context, that this is a common risk area, and 
has to be addressed in the Science & Technology (S&T) 
environment from a common perspective. This is not purely an 
EFV concern. So EFV has not done any dedicated testing to date.
    Mr. Taylor. Colonel, believe me, I respect you. I respect 
your profession.
    Colonel Taylor. Yes, sir.
    Mr. Taylor. But we are today operating AMTRACs hundreds of 
miles inland, because there is a riverine environment where you 
occasionally, because of bridges being either suspect or gone, 
have to have those capabilities. I understand that. I also 
understand that we have an adaptive enemy who has been 
learning, unfortunately pretty quickly, as he goes along.
    If that vehicle were in production today--let's say we 
fixed the mechanical problems--so if that vehicle was in 
production today and was traveling in Anbar Province or 
anywhere else in Iraq, and encountered the same explosive 
device that the AMTRAC did a couple of years ago, what would be 
the results? Has that been tested?
    Believe me, I understand the production for this--I mean, 
the faultline on this started in 1996. That was a long time 
ago. I appreciate the huge technological challenges, but if we 
don't address this now, shame on me and shame on all of us.
    Colonel Taylor. Yes, sir. To the best of my ability, I will 
answer it in this fashion. It has not been addressed on the 
EFV, but it has not been addressed any better on any other 
vehicle at this moment in time, but we have to get there.
    Mr. Taylor. Well, given the Marine Corps' crash program, 
and I respect that crash program, to try to field an MRAP, 
because of what we have seen happen to the Humvees and other 
flat-bottom vehicles, why isn't this being looked into? The 
program is already behind schedule, so if we are going to build 
it, and if the Marine Corps tells me they still want it, I want 
to work with you to build it.
    If we are going to build it, why don't we build it in a way 
that would make it more survivable to a threat that we didn't 
know existed ten years ago--should have known, but didn't--but 
we certainly know exists now?
    Colonel Taylor. Yes, sir, I will take as an action to see 
what is being done.
    Mr. Taylor. Do you mind if I turn to your left?
    General Gardner. Sir, I would just say that in a sense of 
the penetrating capabilities of underbelly mines out there, we 
are somewhat limited by the flat belly, but there are things 
that have been done to the EFV that make it more survivable in 
any kind of incident than the current IED out there--an 
improved fire extinguishing system; spall liners--these sorts 
of armoring things out there do make the vehicle more 
survivable today on the battlefield, that same vehicle today 
out there.
    Now, where that particular mine went though, I cannot sit 
here and testify that it would not penetrate, it would not 
cause injury and death. But I do feel that we have done 
everything else within the capability of the vehicle to put in 
the kind of survivability--things like fire extinguishing 
capability. You can help me out here maybe with general 
capabilities, those sorts of things.
    Mr. Taylor. I understand the need for a lifting body. I 
understand buoyancy, but you can also get a lifting body with a 
V-shape. It is a bit more difficult. It actually makes the 
vessel more seaworthy, and it certainly would make it more 
survivable to an attack like that.
    So my question is, if we are this far behind schedule; if 
we are looking at other things, why aren't we looking at that 
as well? Because I would hate to rush to production a vehicle 
that within several months, 60 Minutes, and moms and dads all 
across America are saying, ``What in the heck are you all 
doing? Why did you send my child to battle in something you 
knew had a flat bottom, when you are in the process of 
replacing every Humvee in-theater for the Marine Corps?''
    General Gardner. Sir, I would just submit that my 
understanding of what the ability of industry is to produce and 
the capabilities out there, and the various threats which 
continue to evolve and challenge us even in the MRAP program, 
that we have to balance risk as well as we can against mission 
capability. We are probably not going to have every vehicle at 
every time going to have an equal amount of force protection to 
the most armored of vehicles.
    Of course, that would be a laudable goal to get there, but 
technologically we need those kinds of science and technology 
efforts that Colonel Taylor mentioned. We believe that there is 
some balance of risk that takes place if you are going to 
achieve some of these niche mission capabilities.
    Mr. Taylor. Okay. Did any of the proposals, either in the 
beginning or more recent proposals for this program, include a 
V-shaped bottom?
    Colonel Taylor. I am not aware of any, sir. I believe that 
the physics would then preclude you from being able to achieve 
your high water speed KPP with a V-shaped hull.
    Mr. Taylor. Again, I respectfully disagree. It would make 
it more difficult. You are not going to get the kind of lift. 
They build V-bottom boats every day all across the country that 
achieve great speeds.
    The chair yields to Mr. Bartlett.
    Mr. Bartlett. I am interested in totally understanding why 
making it V-bottom would make it less like a boat. Most boats I 
am in do have a V-bottom. I think properly designed, that 
shouldn't be inconsistent with our goal of high water speed, 
should it? Because every boat I have seen going fast on the 
water, has a V-bottom rather than a flat bottom. Am I correct?
    Colonel Taylor. Yes, sir. I believe it comes down to the 
weight and torque ratio. I really believe it has a lot to do 
with the existing vehicle's ability to get up on plane. That is 
what allows it to achieve that last percentage of high-water 
speed, once it gets up on plane. Without getting up on plane, 
this vehicle right now tends to wallow down in about the 14- to 
17-knot range.
    Mr. Bartlett. Almost everything we do is the result of some 
compromise. I agree with the chairman that this newfound 
vulnerability in the Humvee would appear to necessitate a look 
at this vehicle to see if we couldn't build into this the kinds 
of protections that were not in the Humvee, that we are now 
moving to the MRAPs to get.
    This vehicle clearly provides the Marines with the 
capabilities that we do not now have. In deciding whether this 
is a must-have or not, we need to look at this requirement as 
compared to many other requirements that we have. It has been a 
long while since the Marines en masse stormed a beach, hasn't 
it?
    General Gardner. That is correct, sir.
    Mr. Bartlett. Of course, this could be used for a very 
small group of people. I understand that. It has been a long 
time since we en masse stormed a beach where this would be an 
ideal vehicle, of course, particularly in the numbers that we 
are anticipating buying.
    If you knew of all the problems that we were going to have 
in developing this vehicle and in looking at all of the other 
needs that the Marine Corps had, if you knew before we started 
this, where we would be today, would you have started? Or could 
this money have been spent better in some other area?
    General Gardner. Sir, we need the ability to mix our force 
lines capability by air and surface, to have that surface 
capability. If the threat has driven our ships over the radar 
horizon, significant distances from the coast, you have to get 
there. If you are going to get there from the surface, then we 
need some sort of surface craft to do that.
    We think this is an essential capability. I think that we 
would still take the same decision. Obviously, we would not 
want to see the program structured as it has been and 
performing as it has been. Hopefully, we are past that with 
this restructuring.
    To your point, sir, about the Marines not storming the 
beach in a long time, there are many capabilities that have not 
been used that are essential to our Nation's security. There is 
a significant deterrent capability in the knowledge of people 
around the world that the Marine Corps has a viable forcible 
entry capability. We would agree that we don't need too much of 
it.
    Once again, I go back to the mix of vehicles and getting 
the right number so that we have a viable operationally 
significant number of Marines that we can do in this manner. 
That is how we arrived at the 573 number. This would support 
surface assault of about two Marine expeditionary brigades, and 
in each expeditionary brigade, about 15,000 Marines--so the 
surface portion of that initial assault.
    So that capability we think out there has a certain 
deterrent value, and was clearly used in the first Gulf War, 
and is frequently assessed as having pinned down a significant 
number of Iraqi divisions, even though non-employed in the 
liberation of Kuwait, as an example.
    Mr. Bartlett. I have a question about the number of 
vehicles. When we thought it was going to cost $5 million, we 
needed over 1,000. When we learned it was going to cost a whole 
lot more than that, all at once we need about half that number. 
And so one wonders about the analysis that is used in arriving 
at the number we need.
    One last question, and this is a problem that existed in 
many, many programs. Apparently, the real cost driver here was 
our desire for high water speeds. That made it a very complex, 
costly and potentially unreliable and difficult to maintain 
vehicle. When we are designing these capabilities, is there 
anybody at the table who is asking when is enough enough?
    There are many of these designs that in spending 50 percent 
of the money, you can get 95 percent of the way there, but that 
last five percent will cost as much money as the first 95 
percent. If we just accept the 100 percent as a requirement, 
and nobody said, gee, could you really make do with a little 
bit less, which will cut the cost in half--is there nobody at 
the table that does that?
    Because so many of these programs, Mr. Chairman, are driven 
because of a requirement that if we had been able to reduce it 
just a little might have massively reduced the cost and 
complexity and kept it more reasonably on schedule and on-cost.
    Who sits at the table to make these arguments?
    General Gardner. Sir, as part of the Nunn-McCurdy 
certification process----
    Mr. Bartlett. But this is after the fact, sir. Who sits at 
the table when we are designing these things and you are 
telling us how much they are going to cost? Who sits at the 
table asking these questions?
    Mr. Ahern. I can address that question. I think that the 
requirements and the program management together--the 
acquisition and the program management.
    I am not going to say that we have had a great tradition of 
doing it well, but the recognition that cost and schedule are 
flexible variables that we can get more of all the time is no 
longer part of our way of doing business. There is in every 
acquisition summary of the program a statement of what the 
technological drivers are for cost in that program, and we look 
at those every month.
    Further, as we begin programs, as I mentioned in my opening 
statement now, we are very sensitive to the effect of pushing 
requirements against cost and schedule. We have a requirement 
to check technological maturity, as well as integration 
maturity, before we go forward on birthing a program.
    Finally, specifically in this program, Mr. Krieg has 
encouraged us as we go forward in this reliability development 
portion of the program, to recognize as we get to key reviews--
the preliminary and the critical design review--that we can and 
should address whether we are over-required and need to 
tradeoff requirements in order to have, as you said, sir, the 
85 percent or 90 percent solution, rather than spending that 
inordinate amount of money and schedule to get that final 10 
percent.
    I think the department has that message now, that cost and 
schedule are variables that we must look at and performance has 
to be looked at at the same time.
    Mr. Bartlett. We just underestimated----
    Mr. Ahern. I think that in this particular area, and I 
think that that was commented on before--this particular 
program, similar to many other programs, the complicated nature 
of the technology, the expectations of particularly the 
waterborne speed, and the integration effort that was going to 
be required, was not as well understood as it needed to be.
    The analogies that were used in the initial costing in the 
middle-1990's were to programs that were available at that 
time. I couldn't go into which one of the programs, but I am 
comfortable from going through this process that they didn't 
have the analogies that were accurate to do the cost estimating 
in terms of the complexity and the technological effort that 
had to be made.
    And so that cost estimating turned out I think to be a 
significant portion of it. As Mr. Smith commented, then we 
needed to have more robust systems engineering, and up front an 
early developmental testing, which I think we have in the 
restructured program, to show us whether or not we are on the 
track--and that is the way this restructured program is 
developed. Instead of being as schedule-driven, as Chairman 
Taylor mentioned, it is an event-driven schedule, with an 
expectation that we will carefully review it at each episode.
    So in summary, to answer your question, I think it was 
technology, cost-estimating connection there, and the 
integration, and then the fact that we didn't put the system 
engineering in to begin with to make up for those. Then we had 
a more schedule-driven than an event-driven program.
    Mr. Bartlett. Thank you very much.
    Thank you, Mr. Chairman.
    Mr. Taylor. The chair recognizes Mr. Courtney.
    Mr. Courtney. Thank you, Mr. Chairman.
    I am still trying to understand what the change is going to 
be after the review. You were starting to describe a different 
process. Maybe you can just help me, as one of the new guys 
here. What does that mean?
    In terms of what we were given, award fees were given out 
during the 1990's and early 2000, in a process which clearly 
was a mistake. I mean, it definitely seems that this process 
was not working, if there were actually award fees given out. 
What is going to change so that we are not going to see that 
type of mistake made again?
    Mr. Ahern. Yes, sir. I would like to address the award fees 
specifically, but only for a minute, and then I would turn it 
over to Colonel Taylor or to Mr. Smith.
    First off, I think that the award fees, the way they were 
structured in the 1990's and in the beginning of the 2000s, 
were less objective and measurable than they needed to be, and 
that has been recognized by the department. About three or four 
months ago, a new directive came out on the criteria for 
developing award fees, for writing award fees.
    I think that the contract--and of course, the award fee 
plan is a part of the contract, and that I where I will defer 
to the Navy, and I will quit right now--that there were 
problems with award fees earlier.
    And in the specific case of this one, I would let the Navy 
answer it--but that has definitely been addressed, and there is 
absolutely, again as with other things that we have learned, 
not only from the Nunn-McCurdy, but just other events in the 
department. We reissued a varied directive not only on award 
fees, but that ties into objective, measurable events.
    Mr. Courtney. And so let's say as event progress or 
develop, and the Pentagon determines that it is not working or 
it is not satisfying what the taxpayer is looking for, what 
happens?
    Mr. Ahern. Those are described, and again I could defer to 
Colonel Taylor, but I want to say, because I was heavily 
involved in the certification, there are off-ramps described--
``off ramp'' meaning go do something else, or we need to look 
at this program very hard--three separate off-ramps before we 
get to a low-rate production decision. Again, the award fee is 
very definitely based on an objective and measurable criteria.
    Mr. Courtney. Does an ``off ramp'' mean cancellation?
    Mr. Ahern. It is a possibility, yes, sir--measurable 
criteria for those events that if not satisfied require a real 
hard look, and that is certainly a possibility.
    Mr. Courtney. Okay.
    Colonel Taylor. Mr. Courtney, let me try and give you some 
additional insight into the award fee. Historically, most 
developmental contracts are in fact cost-plus award fee. That 
is no excuse. It is just a statement of fact, probably a lesson 
learned. You are correct in that General Dynamics earned $82 
million in award fee payments of a potential $103 million. 
Another way to look at that is they failed to earn $21 million 
in award fees.
    Additionally, historically award fee payments are probably 
up around 14 percent or higher. There was only an available 
11.5 percent opportunity and General Dynamics only earned 8.1 
percent. But you could say, okay, they earned 8.1 percent for 
bad behavior. Noted.
    What have we done to try and improve this? First of all, 
here was the award fee criteria associated with the cost-plus 
incentive fee contract. Forty percent of it was given for just 
the objective attainment of cost performance index (CPI) and 
scheduled performance index.
    So for instance, if they only achieved a .09 on CPI, they 
still got 90 percent of that 40 percent. And then 60 percent 
was technically oriented, but a subjective criteria. So it was 
more a focus on program risk areas at a given point in time, 
rather than objective and tied to critical path events.
    So what have we done to perhaps address the taxpayers' 
concerns? On the 15th of June, we modified the existing 
contract and we will follow suit in the follow-on contract and 
award a cost-plus incentive fee.
    What has changed? We have designed very discrete and 
objective criteria that is tied to program critical path 
events--technical reviews. And we have assigned very specific 
exit criteria. General Dynamics must achieve the exit criteria 
at these technical reviews or they get nothing.
    So in essence, Mr. Ahern mentioned three decision points. 
These new toll gates associated with technical reviews add an 
additional three to four toll gates for a total of as many as 
seven prior to the milestone decision. Those are very discrete 
events and the award fee is back-loaded, as opposed to 
previously where as long as they achieved up front in terms of 
CPI and SPI, it was front-loaded.
    Now, you take three of the key technical reviews, it is 
back-loaded. So the most critical one, critical design review, 
is the point at which they must prove that they can meet the 
reliability with the new design that is 50 percent of the award 
fee. So it is all or nothing--50 percent at that point in time.
    And then backing off from that, there is an SFR review 
where they can gain 30 percent, and an SSR where they can get 
20 percent. But it gets more difficult as the program 
progresses for them to earn award fees, and it must be very 
black and white. It is objective. They achieved the exit 
criteria or they did not.
    Mr. Courtney. The other question I had is, General Gardner, 
congratulations on your appointment. You described again the 
need for this type of vehicle in terms of some scenario that 
could develop in the future. If that need popped up today, or 
in the near future--I mean, obviously we are still a long ways 
off of these vehicles being available--what would the Marine 
Corps use?
    General Gardner. Yes, sir. We would have to use our 
amphibious assault vehicles, AAVs, that we currently have, 
which are displacement vehicles and operate--ships come in 
close to the beach, 5,000 yards off the beach; push the 
vehicles out and they go ashore at somewhere around five knots 
or so. Hence, they have to go in pretty close. Then you are 
taking risks with those ships to come in that close.
    So the Marine commander has to persuade the naval commander 
that he needs to take that risk with those ships to push those 
vehicles out. The naval commander will obviously push back on 
that and will not want to do that, and will try and persuade 
the Marine commander not to have a surface assault capability.
    There are situations where you need that surface assault 
capability. You cannot just do it by air. And so, it presents 
us with a dilemma today, and this is a situation that the 
commandant is concerned about, that we are putting our naval 
commanders--we are forcing them to make this sort of risk 
decision.
    Mr. Courtney. Thank you.
    Thank you, Mr. Chairman.
    Mr. Taylor. The chair recognizes Mr. Ellsworth.
    Mr. Ellsworth. Thank you, Mr. Chairman.
    Thank you, gentlemen.
    I am not sure who the best person is for this first 
question, but this vendor on this particular vehicle has been 
around a while. They are not a brand new company that has just 
gotten into the business of military supplies. Is that correct?
    Colonel Taylor. Yes, sir.
    Mr. Ellsworth. It is your experience that--and I will go 
ahead and say it--General Dynamics has provided in the past 
good equipment that works, that has come in on time and on 
budget, ever in history?
    Mr. Ahern. Virginia class, I think, sir, is one recently. 
Of course, that is not the land systems group. That is Electric 
Boat up in Groton, Connecticut. That is one example that I 
believe is on track now.
    Mr. Ellsworth. They have done good things for our country 
and our military.
    Mr. Ahern. Yes, sir.
    Mr. Ellsworth. I would agree with that.
    Mr. Smith, there was something I would like to go back to. 
You talked about the fact that this program was not fully 
funded, and then you said--and I missed it; it was my fault--
the third ``blank'' engineering.
    Mr. Smith. That caused a deferment. The lower funding 
levels caused a deferment of the systems engineering that would 
normally be done in a later period of the systems development 
and demonstration of the schedule, and that is what I was 
trying to articulate.
    Mr. Ellsworth. Okay. I was just reading this document, and 
one of the tables talked about it being underfunded by at least 
$400 million, resulting in design shortcuts and inadequate 
testing. That really concerns me, that if this company, 
obviously a price when you sign a contract for anything it is 
both sides agreeing on a price of what they think that will 
cost. If you get into that, then I would expect, and it looks 
like--and that will come in another question--that the company 
should have come and said this just isn't enough money.
    It appears from this chart that when they got into it and 
because they were underfunded that they took shortcuts on a 
vehicle that is going to, like I said, design shortcuts on a 
vehicle that we are putting American soldiers in. I cannot 
believe that this company and we would accept that we are 
taking design shortcuts that are, like Chairman Taylor said, to 
put our troops in a vehicle because it was underfunded.
    That is a huge concern. I don't know if you want to respond 
to that or not, but that is probably my biggest concern, that 
they would willingly do that based on their funding. Or is it 
that for $400 million less, did we take the C-team engineers to 
design this at the company, because we are less? Or are they 
all paid the same? I am stuttering because I am shocked, I 
guess.
    Mr. Smith. Let me see if I can offer a few comments in 
response, sir, to help you understand perhaps a little bit 
better, and for the other members. We did four different 
independent reviews, and in part of the Nunn-McCurdy review 
process, there was a big management review, both of the 
government management structure and of the corporation's 
management structure.
    General Dynamics Amphibious Systems, which is co-located 
with the EFV Marine Corps Program Office down at Woodbridge, 
Virginia, in some instances was divorced from General Dynamics 
Land Systems corporate knowledge base. Their systems 
engineering capability did not matriculate down. And also 
because it was a separate geographic location, we determined 
that some of the management perhaps did not pay as much 
attention to the oversight within the corporation.
    As well, there is enough I think to go around here, the EFV 
program management in the Marine Corps because it was in ACAT 
1D, an acquisition category 1D program, it did not have a 
typical program executive officer structure that the Navy and 
other services have. It was a direct-report program manager to 
the acquisition secretary in the Navy. And I don't know how 
long, but it was a long time--at least since inception.
    As a result, because of that lack of professional type of 
flag or very senior acquisition professional officer oversight, 
some of the hard questions and some of the hard reviews were 
not performed. That is one of the reasons that both the 
assistant commandant of the Marine Corps and the acquisitions 
secretary of the Navy have selected Colonel Taylor, who was 
part and parcel in really getting the MV-22 program back in the 
air successfully, and selecting him as the program executive 
officer now.
    So with the new management structure like that in place, it 
will be much more rigorous oversight from here on out. That is 
one of the EFV success points that we are trying to achieve as 
a way forward. So hopefully that answers you. It is a 
roundabout answer, but hopefully it answers some of your 
questions.
    Mr. Ellsworth. Mr. Chairman, did we waive the five minutes?
    Mr. Taylor. Absolutely.
    Mr. Ellsworth. Okay. I just wanted to know if I need to 
skip a couple of questions.
    One of you said--and I don't know if it was Mr. Ahern--I am 
not sure if Mr. Smith said that we could look at this a 
different way. Maybe it was the Colonel. That on the bonus, the 
$82 million bonus, that we could look at it in a different way, 
that they got cut 21 percent because they didn't deserve the 21 
percent.
    In the list I am looking at in a chart in here, and going 
on a list of failures, is there a laundry list somewhere of the 
79 percent that they did receive of good things that this 
vehicle does? I mean, are you convinced that they deserved the 
79 percent of that $82 million? Where is the laundry list of 
good things about this? How many of these vehicles are actually 
operational right now?
    Colonel Taylor. We haven't reached IOC yet, but there are 
nine prototype vehicles operating out there.
    Mr. Ellsworth. Is there that list we can look at that says, 
``Here is why they deserved the 79 percent''?
    Colonel Taylor. I think I would stop short of saying they 
deserved it. They were legally entitled to it by virtue of 
achieving the terms and conditions of the negotiated contract, 
whether right or wrong. And I think we have taken note of your 
concerns, and like I mentioned previously, we have completely 
modified the existing contract to try and take a more prudent 
approach to the award fee.
    Mr. Ellsworth. I understand. I was a county official 
before, you know, five months ago and was in on some contracts. 
Even in the election, I made contract offers for a win bonus, 
but you had to win for that group to get their bonus. I am 
building a new jail. We had things built in, but it was at the 
completion. So I understand that.
    I just think the American people expect the Federal 
Government--we have been around a while--and that we would do a 
better job when we supply equipment to our military that if it 
is good enough for the feds, it is great. So I am just a little 
disappointed sometimes when we get into this situation.
    I guess my last question is, and this was spec'ed out at 
$6.2 million apiece in 1995. Is that accurate, according to the 
documents?
    Colonel Taylor. It was $6.7 million.
    Mr. Ellsworth. Okay.
    Colonel Taylor. And in 2007 dollars to baseline, your 
comparison, it was about $6.7 in the original contract award 
back in 2000, as a starting point.
    Mr. Ellsworth. And now they are back to $16.9 million in 
2008 dollars?
    Colonel Taylor. In 2007 dollars, yes, sir.
    Mr. Ellsworth. In 2007 dollars, and this contract is 
supposed to go until 2025? I mean, can you tell me what is--
that is pretty drastic.
    Colonel Taylor. We are actually only on the development 
contract right now. The actual production contract, there is an 
LRIP contract planned for 2011, if all goes well. The full rate 
production decision will be in 2015, I believe. Right now, we 
are strictly working with the development contract.
    Mr. Ellsworth. In the contract, was there a percentage that 
the company, the vendor would give us a range, a top-end of 
what this could go to per vehicle, due to steel, due to 
electronics, capital, whatever it might be--it could vary 
between this and this so we know what the top end could be?
    Colonel Taylor. Sir, that is actually the job of the CAIG 
estimate, and working with their cost curves. It is really a 
band and a confidence level.
    Mr. Ellsworth. It just seems like a huge--a huge--gain over 
those years. I know there is inflation, but----
    Colonel Taylor. The majority of that, it is nearly double 
the original estimate back in the 2000 timeframe, and was based 
on what Mr. Ahern mentioned earlier--estimating analogy errors. 
Essentially in retrospect, I think they would have been better 
off comparing the complexity of this vehicle to an aircraft 
instead of the legacy combat vehicles that are much more 
simplistic designs. I think that was a failure in the 
estimating.
    Mr. Ellsworth. In closing, I thank you. I know this is not 
a fun hearing for you. It is not fun for us. I would ask that 
we learn from this and give the public more of what they 
deserve. They may not expect perfection from any of us, but 
they expect and deserve a little bit better than this. So I 
would like to thank you all for your testimony.
    I yield back, Mr. Chairman.
    Mr. Taylor. Thank you.
    Mr. Ahern, I am curious. You touched on the varied 
requirements of this vehicle. One of them that really caught my 
attention was that the vehicle could launch in two-foot seas 25 
miles from shore.
    Now, I just had an opportunity to visit with Captain Ebbs, 
who retired from the United States Navy, a captain, and asked 
him a couple of scenarios. How often would he see two-foot seas 
25 miles off the coast of Korea? Or off the coast of Taiwan? Or 
on the Persian Gulf? He felt like that was an extremely small 
percentage of the time.
    So given that, number one, I certainly wasn't there, but I 
have seen the videos of D-Day, those Hades boats launched in 
significantly higher seas than that. How realistic an 
assessment was that? And you were only counting on a breeze 
from shore? Again, I think it would be fairly rare that you are 
having an off-shore breeze 25 miles out at sea. I don't think 
that is going to happen.
    So even if it failed to meet the goals that you set out to 
meet, and even those, in my opinion, were unrealistically low.
    General Gardner. Sir, at the risk--I will take that on, on 
the requirements, with perhaps just a comment here.
    We have talked the last few minutes here about something 
that we see as sort of the iron triangle as we procure material 
capability, of requirements, resources, and acquisition. 
Instead of doing this literally where the requirements people, 
the Marine Corps figures out exactly what they need; go to the 
resources people; go get the money; and then go give it to 
acquisition and just patiently wait.
    We are working at this more like a triangle now in which 
there has to be flex on the sides to achieve the objective. I 
think that gets to a little bit of what Congressman Bartlett 
was talking about, who is responsible here. On the 
requirements, we did a detailed scrub of the overall review as 
part of this process, just a bottom-up. I will be asking for 
more capability here than we need in any area.
    Mr. Taylor. General, I think you are asking for less 
capability. I am told that the shores of Normandy, that the 
bottom of that water is full of what was supposed to be tanks 
that would float and swim their way into shore, and failed and 
killed the crews. I sure as heck don't want to repeat that 
mistake.
    General Gardner. The direct answer to your question, sir, 
what we are talking about is significant wave height, not seas 
per se, the sea-state. I fear treading here, so I was talking 
to a former Coast Guardsman about seas, but sea-state and the 
seas and the swells--we are talking about the significant wave 
height which is the seas above the swells--so it is that two to 
three feet that we are talking about.
    We have assessed that the impact of reducing from a three-
foot significant wave height to two-foot significant wave 
height, probably we would encounter the difference between 
those seas about seven percent to 16 percent of the time in 
various places around the world, depending on where it is and 
the time of year. There is a chance where you would not be able 
to do a mission because you had chosen this.
    The reason we went down this road was to try and achieve, 
to ensure we are not asking for more than we could actually 
use. We are talking about the physics of moving ashore with 
this vehicle. This is not an LCAC that transits back and forth 
to the beach routinely. Its primary mission is to go from ship 
to shore. It is not really practical to take the EFV and slam 
into head seas at significant weight in there. It is too many 
Gs on the troops inside, on the passengers in there.
    So it is like a driver of an EFV, as we examined this 
requirement, it would not do that. We have to go to great 
lengths to find seas of that nature that provide this three-
foot significant wave height above the swells to even test the 
vehicle to that. And then when we find that, you set up the Gs 
and do this--and probably somebody can talk to the actual tests 
that are taking place. It is not something that the troop 
commander would do.
    So we felt that this was an area that we could take risks 
and provide some weight margin to the program manager so that 
he could then design in components to improve the reliability 
of the system. So this is where I get to on this triangle of 
making the adjustments.
    We did the same thing with regard to tactical reach. The 
requirement at one time previously was 25 miles ship to shore, 
and then go 200 miles inland. What we said is, once we go 25 
miles ship to shore and operate in an initial assault, we don't 
need to fill the tank up with 200 miles worth of gasoline, with 
fuel. We will fill it up with 100 miles.
    At that, we could take that risk and operate. The vehicle 
still has the ability to go 345 miles while ashore if it is a 
land-assault-type environment. And then we removed a smoke 
grenade launcher that we felt was never really used in 
operational scenario.
    So combined, what we did was try and find are there things 
in here where we were asking for more than we would practically 
use. The analogy that I have kind of thought this true, and I 
hope I can use it here, is that it is going to a car dealership 
and having a car that can go 100 miles an hour, and he tell 
you, yes, well, if you just buy this spoiler and put it on 
here, it can go 100 miles in an ice storm.
    Well, yes, but why would I want to pay extra money to put 
that spoiler on there to go do that? I wouldn't drive 100 miles 
an hour in an ice storm. So that is sort of the thought process 
behind the reduction in significant wave length from three feet 
to two feet.
    Mr. Taylor. General, I am less than convinced with the 
answer, with all due respect. If you have only got a platform 
that can be launched 18 percent of the time safely--and again, 
this isn't from me, this comes from Captain Ebbs, who spent the 
better part of his life at sea--in the scenarios that are 
likely and foreseeable, that just doesn't make sense.
    General Gardner. No, sir. It is a reduction in----
    Mr. Taylor. If I may, sir? The V-hull that would make the 
craft more survivable in the event of a mine would also make 
the hull ride better in a heavy sea. That is simple fact.
    I am concerned that you still continue to have mechanical 
problems after $2.3 billion of the taxpayers' money. You have 
nine vehicles to test that break down way too often. I haven't 
heard anything today that gives me any degree of confidence 
that you are addressing these problems. So let's walk through 
this hopefully so that I can understand this.
    How does the Marine Corps handle a program like this? Do 
you take an officer and say, ``It is your job to make this 
work; I want you to ride that contractor, find out what the 
problems are and solve them and report back to me''? How does 
this work, and what is the rank of that officer? How long will 
he have that job? Is that his career billet or is he pulled out 
of combat and stuck in this for a couple of months and then 
pulled back into combat? How does that work for the Marine 
Corps?
    Because, General, again, this is not something unique to 
the Marine Corps. We have problems with the littoral combat 
ship. We had problems with the Deepwater program in the Coast 
Guard. What we are trying to do is see to it that we don't keep 
making the same mistakes. So I am curious how the Marine Corps 
handles this now.
    General Gardner. That is the defense acquisition 
specialist, and he may want to answer the question, sir. Please 
go ahead.
    Colonel Taylor. I will at least attempt to get started 
here. It has its genesis in the Defense Acquisition Workforce 
Improvement Act. It specifies very stringent qualifications 
training, experience--years of experience----
    Mr. Taylor. Again, with all due respect, we are going to 
have votes any minute now. Tell me how the program works right 
now. Don't give me the script that I would read in a DOD 
manual. In terms that this committee can understand that you 
would be telling a friend over a cup of coffee, how does this 
program work within the Marine Corps?
    General Gardner. Sir, because the program has been----
    Mr. Taylor [continuing]. From the uniformed Marine side.
    General Gardner. Yes, sir. Because the program is an ACAT 
1B program, the defense acquisition executive is the 
acquisition executive for the program.
    Mr. Taylor. And his rank is what, sir?
    Colonel Taylor. That is Mr. Krieg.
    Mr. Taylor. Who do you have in-uniform who would really 
understand with a sense of situational awareness what this 
vehicle is needed to do? Who do you have in uniform that has 
been there, can envision this, that is following the program?
    Colonel Taylor. The program manager is the rank of colonel. 
He is fully qualified from an acquisition perspective. He also 
has lengthy combat experience and combat vehicle experience as 
an operator.
    Mr. Taylor. And his name is?
    Colonel Taylor. Colonel John Bryant. He is the program 
manager.
    Mr. Taylor. How long has he been the program manager?
    Colonel Taylor. He has been the program manager since last 
fall, I believe September.
    Mr. Taylor. And under the normal routine, how long would he 
be the program manager?
    Colonel Taylor. Four years, sir, or the next milestone.
    Mr. Taylor. I am curious, why isn't he here today?
    Colonel Taylor. The letter requested specific attendance.
    Mr. Taylor. Okay. If I could, I would like to request, 
General, that we have a follow-up in a briefing forum--whatever 
you are more comfortable with. I think given the severity of 
the perceived problems that it would be beneficial to all 
involved to get him here.
    Colonel Taylor. Yes, sir.
    Mr. Taylor. So keep going, sir. So you have a colonel?
    Colonel Taylor. Above the program manager----
    Mr. Taylor. And he is going to be doing this for four 
years.
    Colonel Taylor. Yes, sir.
    Mr. Taylor. So he sees a problem. He sees a problem with 
mechanical breakdowns. He sees a problem with unreliable 
hydraulics--any number of things. What does he do then?
    Colonel Taylor. I would like to approach it from a 
different perspective, sir. The way that the restructured 
program is laid out, he is pulled from one of the books of 
acquisition doctrine and system engineering doctrine, and he 
has applied to the program what I haven't seen in the past, 
which is knowledge points.
    He has built in five knowledge points into the program, 
which are benchmarks at which point the contractor must meet 
specific reliability criteria, either from a predicted 
standpoint or a demonstrated standpoint, or based on 
modifications, lessons learned because of underachievement--
another knowledge point is predicted.
    Ultimately, the end-state, the last knowledge point, should 
give you absolute confidence before it goes into IOT&E, the 
final exam, that you can in fact achieve the reliability KPP 
before you actually go in to test. It is a very disciplined 
process that I haven't seen used before.
    Mr. Taylor. I understand it is a disciplined process, but 
we can also see times when the requirement didn't really fit 
reality. I think a two-foot sea-state falls into that, 25 miles 
offshore--it is one of them. It slaps me in the face that that 
is not realistic. Okay, so does this colonel who has combat 
experience, who is responsible for the lives of other Marines, 
does he just sit back and say, well, that is not the 
requirements; I won't look that way?
    Colonel Taylor. No, sir.
    Mr. Taylor. All right, when he sees something that he knows 
to be wrong, what does he do?
    Colonel Taylor. The acquisition benchmarks become 
triggering mechanisms if at one of those knowledge points he 
believes he is not on the reliability growth curve that will 
ultimately achieve the reliability KPP at IOT&E. We turn to the 
requirements community and ask them to assess additional trade 
space.
    General Gardner. The requirements, sir, are significant 
wave height, not sea-state. I want to make that distinction. 
Because this is an ACAT 1B program, that was a key performance 
parameter, that is a JROC-held requirement. So once we develop 
the idea that there is some trade space here in these 
requirements, that was staffed through the Marine Corps 
operational concepts thing, and then put into the joint 
process, and was approved by the JROC as certification of that 
process, of the requirement.
    That requirement, then, the acquisition community then 
seeks to fill that requirement. The Marine Corps then at that 
point, you know, we are here to support the acquisition 
community in terms of seeking resources from the Congress and 
ensuring that our requirements are understood. If they are not 
there, then we need to look at examining those.
    Mr. Taylor. General, let's go back to the issue--and, 
again, it is something I didn't see coming, should have seen 
coming. We spent a lot of money to up-armor Humvees to have a 
vehicle that is susceptible to a blast with a bottom. I say 
that in that I don't want to keep making the same mistakes. You 
are doing the vehicle with the flat bottom. You have people 
with combat experience who have seen Humvees blown up in Iraq.
    Did anyone along the way say maybe we ought to re-think 
this before we go into full-scale production as far as the 
bottom of this vehicle? And if not, why not?
    General Gardner. Sir, we looked at the overall--we are 
trying to develop a ground vehicle portfolio, if you will, of 
all the vehicles that the Marine Corps has to accomplish its 
range of missions. We tried to standardize all of the armoring 
requirements and their resistance to threats, and we put this 
on that scale.
    So we did look knowing that this was not going to have the 
force protection capability of an MRAP, for example. We were 
led to believe that this was not possible to achieve 
technologically without even more time and more delay than what 
we had. So we felt that this was, while a risk, an acceptable 
risk to be able to accomplish this capability in the right 
time.
    If we got into those threat profiles where we expect to see 
this sort of underbelly mines, we would not use the EFV and the 
AED in those sorts of profiles. This is a niche capability that 
we are seeking to provide.
    Mr. Taylor. Why would we rush to produce something that is 
probably already obsolete? Because, again, I greatly respect 
the Marine Corps making the most of what they have. I recently 
visited your guys in Fallujah in a helicopter I am told was 
built about 1972. That is pretty impressive that you have taken 
care of it this long. On the flip side, it means you have to 
live with your mistakes.
    Why not correct that mistake before we make it?
    General Gardner. Sir, I can only say that we are trying to 
do that by looking at our ground vehicle mobility as a 
portfolio, and providing our force commanders a choice of 
vehicles, sufficient vehicle support out there so he can use 
the right vehicle on the right day for the right mission.
    Mr. Taylor. Who owns the rights to the work done to date on 
the EFV? Is it the government or the contractor? If we wanted 
to take that design and turn it over to someone else for 
manufacture because we have just had enough of the folks we are 
dealing with, do we have the right to do that? That is the same 
question we have asked with the LCS, and same question we have 
asked with the Deepwater.
    Mr. Smith. I believe we do, sir, but I would have to 
absolutely confirm what level of technical maturity that data 
is.
    Colonel Taylor. I would go one step further, sir, and say 
we own the right to potentially buy the data. It does not 
necessarily mean that we currently own all the data.
    Mr. Taylor. Okay. For the record, would you ask the legal 
community to answer that question?
    Mr. Bartlett.
    Mr. Bartlett. Mr. Chairman, why would we enter into a 
contract where we pay for everything and give them very 
generous fees for what in the real world would appear to be a 
failure? And then you have to buy the data rights from them? 
Weren't all these data developed with taxpayer money? Why do we 
have to pay for it twice? Because that is the way we wrote the 
contract?
    Colonel Taylor. No, sir. This is fairly standard.
    Mr. Bartlett. But why do we want to pay for it twice? We 
have paid for it, because all of the money that they spent on 
this program has come from the taxpayer, plus some very 
generous fees. And now if we want the data rights, we have to 
pay them for it?
    Colonel Taylor. Typically, the data that goes into the 
initial design is proprietary and the government has an 
opportunity to buy the data package.
    Mr. Bartlett. We run into this with many of the programs, 
and we have been assured that the Navy will in the future try 
to write the contract so that there is more assurance that what 
the taxpayer has paid for, the taxpayer in fact will have 
access to. That appears not to have been true in the past.
    Thank you, Mr. Chairman.
    Mr. Taylor. Thank you, Mr. Bartlett.
    Mr. Ellsworth.
    Mr. Ellsworth. Thank you, Mr. Chairman.
    Just one last question for me, and Colonel, maybe you are 
the best one to answer. You started to allude to it about what 
we are doing now and the benchmarks. At what point and how 
long--and I want us to have a vehicle, from the bottom of my 
heart, I want the biggest, baddest military, the meanest, the 
best equipped, and then I am going to fight like hell to never 
have to use them, if I had to speak about a philosophy of mine.
    How long do we go on, and how much--where is our end? Where 
do we say, or the vendor comes up and says, we just can't 
produce it; it is done; let's pull it and move on to plan. Or 
we say, we can't wait any longer; we can't spend any more 
dollars on this design. When does that occur? Is that one of 
the benchmarks, the first one? Or a group of those?
    Colonel Taylor. Any one of the seven that I pointed out, 
eight, including the actual milestone to go into LRIP 
production. So that decision can come by virtue of the program 
manager's assessment at one of the knowledge points, that we 
are not on the reliability growth curve; or it can come by way 
of the acquisition decision executive at one of his three 
decision points prior to the actual LRIP decision that, hey, I 
am not comfortable with where the program is. So there are 
numerous opportunities to assess continuing the program.
    Mr. Ellsworth. Just a basic time, is that going to occur in 
2008, or end of 2007-2008?
    Colonel Taylor. The three decision points by the 
acquisition executive comes at contract award, critical design 
review, and then before committing to long-lead items for the 
LRIP build. Those are the three acquisition executives.
    And the first two occur roughly in fiscal year 2008. The 
third would not occur until just before the actual milestone C, 
so probably 2011. And then the knowledge points for the program 
manager, one occurs in 2008; two occur in 2011; and one is 
actually post-milestone C.
    So it is over the course of about four years, there are 
almost seven of them.
    Mr. Ahern. I would like to elaborate on that. As Colonel 
Taylor said earlier, the decision authority informed by the 
program manager and other events is the defense acquisition 
executive. As a result of this process, he has determined that 
he wants to look into the EFV on a quarterly basis. He has 
scheduled meetings with the CEO of General Dynamics, as well as 
the acquisition executive in the Navy quarterly to review this 
program, as is done in industry on essentially the same kind of 
an investment review.
    So I think besides, as Colonel Taylor mentioned, the 
knowledge points and the structured formalized meetings, the 
DAE working with the CEO of General Dynamics is going to keep a 
very close idea, pulse, on where this program stands for the 
duration of this development phase. I think that also goes to 
answer your question about are we focusing on looking at how 
the program manager is doing, what issues he has, and what 
alternatives he has when he runs into a problem, on a quarterly 
basis.
    Mr. Ellsworth. Thank you, Mr. Ahern.
    Mr. Chairman, I yield back.
    Mr. Taylor. Hopefully in fairness to our witnesses, you 
have been very patient. You have been with us for a while. Is 
there anything that you would like to add at this point? I will 
just open it up to you.
    Mr. Ahern. I would like to go back to your original 
question, Mr. Chairman. I was in the Navy. I was a program 
manager for ACAT-1 program. I have made a lot of mistakes, but 
now I am in AT&L. I think that the lessons learned through this 
process, is that we have begun to learn earlier or implement 
earlier, as General Gardner said, of the iron triangle.
    We can no longer operate in that phase of a group of people 
who make up requirements and then a group of people decide how 
they are going to build it, and then another group of people 
decide how it is going to be funded. This has been changed.
    As I mentioned earlier, that lesson learned of having the 
right combination of requirements, funding and an acquisition 
plan, including an informed sense of where the technology 
stands, is one of the clear things, or reinforcement of what 
came out of this Nunn-McCurdy process. Just the visibility of 
the numbers of groups of people that were involved--four teams 
per Nunn-McCurdy, and we had six Nunn-McCurdys in 2007--
encourages me to think that we have all learned we have to 
birth them well.
    And then further, I think as has been mentioned with this 
kind of event-driven schedules, the use of earned value, the 
use of the other management-focused things, including the CEO 
meetings, convinces me that we have applied the lessons learned 
from these programs so that in the future, our performance in 
acquisition in the requirements community will be improved over 
what it was previously.
    Mr. Taylor. What are the most recent reliability statistics 
for those vehicles? I understand that they were supposed to go 
about 50 hours without breaking down. Now they are doing it in 
less than double digits. Is there any trend to give me or 
anyone else some degree of confidence that that problem has 
been overcome?
    Mr. Ahern. I would defer to Colonel Taylor.
    Colonel Taylor. I would say, sir, that you have brief 
glimpses in an operationally representative environment via 
operational testing, so those come in brief glimpses. To give 
you a pure look in the developmental test environment, it is 
not an apples-to-apples comparison predominantly because 
developmental test vehicles are loaded with orange wire and 
black boxes. A preponderance of the maintenance associated with 
these vehicles--getting them ready for tests--involves 
configuration and de-configuration.
    So there is a disproportionate amount of effort associated 
with getting prepared for developmental tests. So the metrics 
are not a good comparison. The best glimpse I can give you at 
this point are those knowledge points, where at knowledge point 
one in fiscal year 2008, the contractor is required to provide 
a new predicted reliability after the design.
    So right there, we have our first glimpse of where the 
design falls relative to a growth curve that will ultimately 
get us to the KPP about four years later at IOT&E. So it is 
really through the systems engineering process that we have to 
rely right now. The developmental test process is not a very 
good gauge of it. The first pure operational opportunity does 
not occur until 2011.
    Mr. Taylor. Are the problems across the board? Do they tend 
to be one thing in particular?
    Colonel Taylor. Well, 60 percent of the reliability issues 
are associated either with the turret or the feed tray for the 
weapons system. Both these systems are proven technology on 
other applications. It is just that they weren't anticipated to 
undergo the stress and strain on this particular vehicle.
    For instance, the turret is similar to I believe the one on 
the LPD-17. The weapons system is 70 percent common with some 
of the other ground combat vehicle systems, but the feed tray 
mechanism is unique. So reinforcing the structure that supports 
the turret and probably a redesign of the weapon feed tray are 
major initiatives to overcome what turned out to be 60 percent 
of the reliability issue.
    Mr. Taylor. Mr. Bartlett.
    Mr. Bartlett. I have no more questions.
    Mr. Taylor. Okay.
    I thank you gentlemen for being here today.
    The meeting stands adjourned.
    [Whereupon, at 5:35 p.m., the subcommittee was adjourned.]



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                            A P P E N D I X

                             June 26, 2007

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             QUESTIONS AND ANSWERS SUBMITTED FOR THE RECORD

                             June 26, 2007

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                   QUESTIONS SUBMITTED BY MR. TAYLOR

    Mr. Taylor. Were there signs, before the fall of 2006, that the 
reliability of the EFV prototypes was going to be such a major problem? 
Were any such warning signs elevated for review by officials outside 
the program by the appropriate officials? If so, what action was taken 
to address these issues?
    Mr. Smith and Colonel Taylor. No. Prior to the Operational 
Assessment (OA), the EFV underwent extensive developmental and 
reliability testing. Test data indicated the EFV was meeting the 
planned reliability growth curve; the last data point prior to the OA 
measured 14.4 hours vs. a planned 15 hours Mean Time Between 
Operational Mission Failure (MTBOMF). Despite this 0.6 hour shortfall, 
the system was assessed to be ready for OA. However, data points during 
the OA revealed the following shortcomings in the EFV program's 
previous reliability test program: (1) EFV's mission essential 
functions were not always utilized during reliability testing; (2) the 
developmental test profiles did not closely match the operational 
profiles performed during the OA. When these two factors were included 
in the pre-OA reliability data, analysis showed the EFV's performance 
was significantly below the planned curve. Thus, post-OA analysis 
largely confirmed the OA performance, and pointed out lessons learned 
to improve future developmental and reliability testing and analysis.
    In response to the program's poor performance during OA, during the 
fall of 2006, the Assistant Secretary of the Navy, Research, 
Development and Acquisition (ASN (RDA)) chartered an Independent Expert 
Program Review (IEPR) to examine the EFV program, system, and processes 
in order to find the root causes of the reliability shortfall and 
recommend a path forward for the EFV Program. The panel reported that 
the root causes of poor reliability were: (1) insufficient funding in 
early SDD that led to inadequate systems engineering rigor in design 
for reliability; (2) focus on the high water speed requirement, which 
drove weight and complexity at the expense of reliability, and; (3) an 
overconfident program advocacy. The panel also cited shortcomings in 
both government and contractor program organization and management, 
oversight, and test and evaluation.
    During March and April 2007, additional in-depth reviews of the EFV 
reliability program were conducted by two independent teams of experts 
commissioned by the Office of the Secretary of Defense (OSD). Each team 
concluded that the EFV reliability requirement was achievable and that 
the EFV program was employing the rigorous methods necessary to achieve 
the requirement.
    Mr. Taylor. What explains the decision to continue EFV development 
with the same contractor? What factors led to rejection of conducting a 
new competition for the new systems development and demonstration 
phase?
    Mr. Smith and Colonel Taylor. The Nunn-McCurdy Certification 
process resulted in a decision to continue with the current program and 
address deficiencies by fixing EFV. General Dynamics Land Systems 
(GDLS) has been the sole EFV vehicle designer and developer since 1996. 
The main design development and production efforts are planned as sole 
source to GDLS because no other firm can perform the requirements of 
development and production without substantial duplication of cost and 
additional, unacceptable delays to the EFV program. However, the EFV 
program plans to compete future contracts for certain EFV program 
efforts, where feasible, to increase performance and reduce program 
costs.
    The factors that led to rejecting a new competition for EFV SDD-2 
were cost and capability, as related to the Nunn-McCurdy Certification 
process. The Nunn-McCurdy review examined three possible alternatives: 
(1) Fix EFV by continuing with the current program and addressing 
deficiencies within; (2) Begin a new start by initiating a new program 
to provide capabilities similar to the EFV; and (3) Upgrade the 
existing Assault Amphibious Vehicle (AAV).
    Regarding the cost factor, the lowest Program Acquisition Unit Cost 
(PAUC) was associated with the third alternative (Upgrade AAV). The 
next lowest PAUC was estimated for the first alternative (Fix EFV). The 
second alternative (New Start) had the highest PAUC due to additional 
Research, Development, Test and Evaluation (RDT&E) costs.
    Regarding the capability factor, the Fix EFV and New Start 
alternatives would provide equal capabilities, while the Upgrade AAV 
alternative provides less capability because of its slow speed, lack of 
firepower, and lack of all-night and all-weather capability. However, 
pursuing the New Start alternative would unacceptably further delay the 
vehicle's availability for operational use by the Marine Corps, 
increasing operational risk to U.S. forces during that period.
    The Upgrade AAV alternative could provide the initial upgraded AAVs 
on the same schedule as the Fix EFV alternative, but due to the slower 
speed of the AAV, the operational risk to amphibious joint forcible 
entry operations is much higher.
    In summary, there are no alternatives to the Fix EFV alternative 
which will provide equal or greater military capability at less cost. 
Initiating a New Start would increase operational risk due to later 
deliveries and incur more cost; pursuing the Upgrade AAV alternative, 
while entailing lower costs, would provide less military capability, 
given the slow speed of the AAV.
    Mr. Taylor. Who owns the rights to the work done to date on the EFV 
program? The government or the contractor?
    Mr. Smith and Colonel Taylor. The following are the rights to 
Technical Data and Software under the EFV System Development and 
Demonstration (SDD) Contract:

Defining Technical Data Ownership

    The Government may order during the contract, or within 3 years 
after acceptance of all items under the contract, any technical data or 
software generated in the performance of the contract or any 
subcontract (which expires 3 years after the contractor accepts the 
last delivery under the subcontract). Generally, if the Government pays 
for data under cost type contracts, the Government gets unlimited 
rights to that data. However, with the SDD contract, the Government 
would have to further develop or procure a technical data package on 
the vehicle design to support a re-competition of the EFV. A decision 
was made early in the program not to purchase the Technical Data 
Package. The EFV SDD contract contains a requirement for the delivery 
of a final design report. The final report includes information 
necessary to be able to produce, maintain and provision the EFV. The 
final report is in contractor format and would not amount to a level 
three technical data package.

Restrictions on Non-commercial technical data and software per DFARS 
252.227-7013

    There are three primary restrictions (Unlimited, Government Purpose 
and Limited) on Non-commercial technical data and software as follows:

    The Government receives unlimited rights in tech data for an item, 
component or process developed exclusively with Government funds. 
Unlimited rights is defined as: data for an item, component or process 
developed exclusively with Government funds; studies, analyses, test 
data or similar data produced for this contract and specified for 
contract performance; form, fit and function data; necessary for 
installation, operation, maintenance or training; or data with 
Government purpose data rights that have expired. The Government 
receives government purpose rights (GPR) in tech data for an item, 
component or process developed with both Government and Contractor 
funds. Purpose rights are defined as: right to use, modify, reproduce, 
release, perform, display or disclose tech data within the Government 
without restriction plus release outside the Government for U.S. 
Government purposes. Also, Government purpose includes competitive 
procurement. The Government receives limited rights when tech data is 
developed exclusively with Contractor funds and marked with appropriate 
legend. Limited rights is defined as: contractor must identify any data 
it is asserting has restrictions in a contract attachment and not 
deliver data with markings unless on attachment.

Rights in Non-commercial Computer Software per DFARS 252.227-7014

    The Government gets Restricted Rights [versus Limited Rights] to 
non-commercial computer Software required to be delivered or provided 
to the Government under the contract if they were developed exclusively 
at private expense. The difference between limited rights and 
restricted rights is; under limited rights, the Government's internal 
use of the technical data is unlimited with the exception of the right 
to use the data for manufacturing. Under restricted rights, the 
Government's internal use of the software is only permitted for only 
one computer at a time with minimum backup copies permitted.

Rights in Commercial technical data per DFARS 225.227-7015

    If a particular item delivered under contract is Commercial, the 
Government typically only receives those rights customarily given in 
the commercial marketplace to any commercial buyer. The commercial 
rights provided for any commercial item typically comes in one of the 
following three types of rights (Unlimited, Limited, Specially 
Negotiated):

    The commercial marketplace might provide for unlimited rights in a 
particular commercial item. Under those circumstances, the Government 
receives data without restrictions; may be in the medium of form, fit 
and function data; may be in the form of correction or changes to 
technical data furnished to the contractor by the Government; is data 
necessary for the operation, maintenance, installation or training 
(other than detailed manufacturing or process data); or is data to 
which the Government already has unlimited rights.
    The commercial marketplace might provide for limited rights in a 
particular commercial item. Under those circumstances, the Government 
receives limited rights in technical data similar to non-commercial 
technical data. The Government may use, modify, reproduce, release, 
perform, display, or disclose technical data within the Government 
only.
    Notwithstanding the commercial marketplace, the Government may seek 
to gain additional license rights with the commercial manufacture 
through specially negotiated rights. In such a circumstance, the 
Government and the manufacturer comes to mutually agreeable terms in 
connection with the specifics of any additional rights provided to the 
Government.

Rights in Commercial Software per FAR 12.212

    With regard to commercial computer software and commercial computer 
software documentation, the Government shall have only those rights 
specified in the license contained for the software. This is consistent 
with the Government receiving a license for commercial software 
customarily provided to the public.

Patent Rights per FAR 52.227-12

    In the performance of a Government contract, the contractor may 
elect to retain title to any invention created. In such a circumstance 
however, the Government shall have a non-exclusive, non-transferable, 
irrevocable, paid-up license to practice, or have practiced for, or on 
behalf of the United States, the subject invention throughout the 
world. If the Government retains title to the invention created, then 
the contractor shall retain a non-exclusive, royalty-free license 
throughout the world in each subject invention to which the Government 
obtains title except if the contractor fails to disclose the subject 
invention within the required time frames provided by law and/or 
regulation during performance of the contract. As a result, for any 
patents that might arise during the performance of a Government 
contract, the Government typically retains at a minimum, a license to 
use the invention for its purposes.

Validation of Restrictions per DFARS 252.227-7037

    A Contractor must maintain records sufficient to justify 
restrictive markings on technical data delivered or required to be 
delivered. The Procurement Contracting Officer can request a Contractor 
to justify markings- pre-challenge. The Procurement Contracting Officer 
can formally challenge markings.

GD asserted restrictions on technical data and software

    It appears that the Government partially funded most of items on 
GD's list but further investigation would be needed to challenge GD's 
assertions of technical data rights. These listed items were 
incorporated by bilateral modification into the contract. The listing 
does not constitute Government agreement with GD's asserted 
restrictions on Government rights. However, the Procurement Contract 
Officer has not challenged GD's asserted restrictions on these items:

        The MTU Motoren-Und-Turbinen Union engine. [Limited/
Restricted]; The Intercom, hardware and software, developed the 
Canadian Forces and Computing Devices of Canada. [Limited/Restricted]; 
The vehicle transmission, developed by Allison Transmission. [GPR or 
unlimited]; The azimuth and elevation drive mechanisms, including the 
controller arm, developed by Missile Systems Division, MOOG Inc. 
[Limited]; The Air Handling Unit (AHU), the Compressor Motor Unit (CMU) 
and the Nuclear Biological Chemical (NBC) Evaporator, developed by 
Fairchild Controls. [Limited/Restricted]; The Compact Modular Site, 
developed by General Dynamics Land Systems, Inc. [Limited]; Components 
of the suspension system, developed by General Dynamics Land Systems 
Muskegon Operations (formerly Teledyne Vehicle Systems). [Limited]; 
Engineering design concepts and interfaces for the High Efficiency 
Waterjet (HEWJ), developed by Honeywell International Inc. The 
following drawings are considered proprietary: [Limited]; and GDLS 
process sheets for the EFV(P) and EFV(C) vehicles containing GD 
confidential trade-secret manufacturing processes. [Limited/Restricted 
case-by-case].

GD did not identify whether it asserts the Government has Limited or 
GPR for:

        GDLS life cycle support concept and architectural 
development initiative which includes but is not limited to internal GD 
processes and tools; Spray-cool technology, developed by Isothermal 
Research Company (ISR); The Conformal Antenna (3) technology, the Radio 
Antenna Interface Unit (RAIU), the HPA/LNA, and the RCS Boot material 
for the VHF antennas, developed by Ball Telecommunications; The 
Hydraulic Manifold Components (Pilot Valves, Pressure Switches), 
developed by Predator Systems, Inc.; The Gyroscopes (MOTS), developed 
by Fibresense; The Remote Acquisition Control Module (RACM) Sub-
components including Power Bus Controller, developed by Vetronics 
Research Corporation; The VIC Intercom (MOTS); The Commander's Thermal 
Viewer (MOTS); The Harris HF Radio, Antenna Coupler and Antenna (MOTS); 
The GPS LNA (COTS); The Electronic Compass (MOTS); The Auxiliary 
Navigation System (ANS); The Wireless headset (MOTS); The Computing 
Devices Canada (CDC) Display technology incorporated into the Vetronics 
displays; The EFV(C) cosite solution; The EFV(C) MMU (COTS).

Conclusion

    The Government:

        Is entitled to delivery of a final design report but 
the report would not provide a technical data package that could be 
used for a re-competition.

        Could challenge GD technical data assertions but GD is 
likely to contest these challenges as it will protect their interest in 
the EFV program.

        Funded much of the development and has government 
purpose rights but further investigation is required to confirm.

    Mr. Taylor. What would it cost to terminate the current development 
EFV contract?
    Mr. Smith and Colonel Taylor. Closeout of the existing contract 
with General Dynamics Amphibious Systems is estimated to cost $70M 
which was derived during the Nunn-McCurdy Certification process. An 
accurate cost determination would need to come from a Termination 
Contracting Officer at DCMA.
    Mr. Taylor. How much of a delay in getting the first operational 
EFV to Marines would be caused by terminating the current EFV contract 
and starting over with a new competition in Fiscal Year 2008?
    Mr. Smith and Colonel Taylor. The delay would be at least five 
years. This is based on assuming a contract award for a preliminary 
design in FY 2008, followed by a detailed design with a Critical Design 
Review which would not occur until FY 2010; then fabrication of the new 
prototypes through FY 2012 with Developmental Test and Evaluation 
through FY 2014, followed by an Operational Assessment occurring in FY 
2016 and subsequent Milestone C if successful. The currently approved 
restructured EFV Program is scheduled to reach Initial Operational 
capability in 2015; the earliest estimate for the alternative program 
is 2022.
    Mr. Taylor. Has any Department of Defense, Department of the Navy, 
Marine Corp., or other government agency employee who had oversight or 
management authority over the EFV program become an employee of General 
Dynamics after leaving government service? If so, in what capacities 
did they serve while in government service and in what capacities have 
they worked for General Dynamics since leaving government service?
    Mr. Smith and Colonel Taylor. Yes. General Dynamics has provided a 
letter to Congress detailing certain individuals that fit this 
category.
    Mr. Taylor. Were any design options featuring a ``v-shaped'' hull 
considered at any time in the EFV program's history?
    Mr. Smith and Colonel Taylor. Yes, but not for mine blast purposes. 
The dihedral concept was first considered for over-the-water 
habitability effects from high-speed landings in order to evaluate ride 
suitability for delivering Marines to battle positions without 
degrading their fighting capabilities. A Full-Scale Hydrodynamic 
Vehicle (FSHV) for a future Landing Vehicle Assault of planning hull 
type served as a technology forerunner to the Advanced Assault 
Amphibious Vehicle and later became the EFV. The FSHV was tested at 
Camp Pendleton, California, in 1979. It was determined the inherent 
form of a tracked vehicle and the nature of tracked vehicle suspensions 
do not lend themselves to V-bottom designs.
                                 ______
                                 
                   QUESTIONS SUBMITTED BY MR. FORBES
    Mr. Forbes. Do you believe that General Dynamics performance 
justifies the $82 million the company earned in award fees? To put this 
in a forward looking context, how is the new award fees structured to 
ensure that the Navy and the taxpayers are not providing awards when 
the overall performance clearly falls short of expectations?
    General Gardner. From 1996 to 2007, the EFV program's prime 
contractor, General Dynamics (GD) was paid approximately $1.7B for 
contract efforts performed during the developmental phases of the 
program. Approximately $125M of the total has been paid in fees ($43M 
in base fee and $82M in award fee), representing approximately 8.1 % of 
the total contract costs incurred to date ($1.53B). GD was entitled to 
the fee earned in accordance with the stated terms and conditions of 
each legally-binding contract. The earned award fee was specifically 
subject to government evaluation of performance in accordance with 
established criteria at the beginning of each performance period. The 
criteria varied with each period to target key risk areas particular to 
that phase of the program. When performance was less than required, 
award fee was denied. To date, GD has been denied $21M in award fee 
(they have received $82M of a total $103M available to earn, an average 
of 79%).
    Although EFV reliability performance fell short of the plan for 
this stage of the program, resulting in an extended development period, 
many other vehicle performance capabilities have been demonstrated at 
their required values due to the significant amount of effort performed 
during the development phase. These capabilities include firepower, 
water speed, land speed, carrying capacity, and interoperability 
performance.
    The development period included highly complex GD engineering and 
design efforts associated with developing a combat vehicle that can not 
only match the M1A1 tank's land speed but can also launch from naval 
ships 25 nautical miles offshore and transition to the shore within one 
hour (at approximately 20 knots). In comparison, the currently-fielded 
vehicle, the Assault Amphibian Vehicle (AAV) launches from ships 
approximately 2 nm offshore and has a peak water speed of approximately 
5 knots. Accordingly, the EFV program determined cost type contracts 
were appropriate due to the risk associated with the complexity of the 
requirements. Cost type contracts are typically used at this stage of 
development in most acquisition programs. The EFV program negotiated 
Cost Plus Award Fee (CPAF) type contracts (maximum base fee of 3%, 
maximum award fee negotiable), rather than Cost Plus Fixed Fee (CPFF) 
contracts (maximum total fee of 10%), to provide a greater incentive to 
the contractor to prove out advanced technological design solutions and 
to give the government greater control over fee paid to the contractor. 
The maximum fee possible on any of the GD CPAF contracts awarded to 
date is 11.5%, with 3% allocated to base fee and 8.5% allocated to 
award fee. Of the 11.5% fee available, GD has earned 8.1 %, appreciably 
less than the 10% the Contractor could have received for a CPFF 
contract.
    The EFV program office recently restructured the current SDD 
contract award fee provisions. This incorporated objective criteria for 
cost, schedule and performance based on the program restructure. 
Specifically, in June 2007, the EFV program successfully renegotiated 
the award fee provisions for the SDD contract to tie available award 
fee pools to the successful execution of Systems Engineering reviews 
and to replace existing, subjective criteria with well-defined 
objective targets for cost, schedule and technical performance, 
including demonstration of the ability to achieve the reliability 
requirement. A multiple-incentive structure was implemented whereby 
General Dynamics must earn a fee in each category or forgo the fee 
entirely. This new structure promotes a balanced approach so that no 
one category is favored to the detriment of the overall performance of 
the EFV.
    Mr. Forbes. Do you believe that General Dynamics performance 
justifies the $82 million the company earned in award fees? I 
understand that the contractor did win a large percentage of the 
incentive award fees, so I would be interested to know what objectives 
were met to warrant the fees? To put it in a forward looking context, 
how is the new award fees structured to ensure that we are not 
providing financial awards when the overall performance clearly falls 
short of expectations?
    Mr. Smith. From 1996 to 2007, the EFV program's prime contractor, 
General Dynamics (GD) was paid approximately $1.7B for contract efforts 
performed during the developmental phases of the program. Approximately 
$125M of the total has been paid in fees ($43M in base fee and $82M in 
award fee), representing approximately 8.1% of the total contract costs 
incurred to date ($1.53B). GD was entitled to the fee earned in 
accordance with the stated terms and conditions of each legally-binding 
contract, negotiated in the mid-1990s. However, the earned award fee 
was specifically subject to government evaluation of performance in 
accordance with established criteria at the beginning of each 
performance period. The criteria varied with each period to target key 
risk areas particular to that phase of the program. When performance 
was less than required, award fee was denied. To date, GD has been 
denied $21M in award fee (they have received $82M of a total $103M 
available to earn, an average of 79%).
    Although EFV reliability performance fell short of the plan for 
this stage of the program, resulting in an extended development period, 
all other vehicle performance capabilities have been demonstrated at 
their required values due to the significant amount of effort performed 
during the development phase. These capabilities include firepower, 
water speed, land speed, carrying capacity, and interoperability 
performance. Reliability was not achieved since the performance 
parameters could not be demonstrated consistently through out testing.
    The development period included highly complex GD engineering and 
design efforts associated with developing a combat vehicle that can not 
only match the M1A1 tank's land speed but can also launch from naval 
ships 25 nautical miles offshore and transition to the shore within one 
hour (at approximately 20 knots). In comparison, the currently-fielded 
vehicle, the Assault Amphibian Vehicle (AAV) launches from ships 
approximately two nautical miles offshore and has a peak water speed of 
approximately five knots. Accordingly, the EFV program determined cost 
type contracts were appropriate due to the risk associated with the 
complexity of the requirements. Cost type contracts are typically used 
at this stage of development in most acquisition programs. The EFV 
program negotiated Cost Plus Award Fee (CPAF) type contracts (maximum 
base fee of 3%, maximum award fee negotiable), rather than Cost Plus 
Fixed Fee (CPFF) contracts (maximum total fee of 10%), to provide a 
greater incentive to the contractor to prove out advanced technological 
design solutions and to give the government greater control over fee 
paid to the contractor. The maximum fee possible on any of the GD CPAF 
contracts awarded to date is 11.5%, with 3% allocated to base fee and 
8.5% allocated to award fee. Of the 11.5% fee available, GD has earned 
8.1%, appreciably less than the 10% the Contractor could have received 
for a CPFF contract.
    The EFV program office recently restructured the current SDD 
contract award fee provisions. The newly restructured contract 
incorporates objective criteria for cost, schedule and performance 
based on the program restructure. Specifically, in June 2007, the EFV 
program successfully renegotiated the award fee provisions for the SDD 
contract to tie available award fee pools to the successful execution 
of Systems Engineering reviews and to replace existing, subjective 
criteria with well-defined objective targets for cost, schedule and 
technical performance, including demonstration of the ability to 
achieve the reliability requirement. A multiple-incentive structure was 
implemented whereby General Dynamics must earn a fee in each category 
or forgo the fee entirely. This new structure promotes a balanced 
approach so that no one category is favored to the detriment of the 
overall performance of the EFV.
    Mr. Forbes. How can the Secretary of the Navy certify to Congress 
that no alternatives exist to the program as required by a Nunn-McCurdy 
certification, while also requiring the Marine Corps to develop a plan 
for an alternative program should the risk mitigation plan fail?
    General Gardner. The Nunn-McCurdy certification pertained to the 
context of existing alternatives, based on the Joint Requirements 
Oversight Committee (JROC) affirmation of the need for a high-speed 
amphibious assault capability. Secretary Krieg's decision to certify 
that no alternatives exist included careful consideration for the 
element of time. That is, he found that no alternative program could 
deliver the same capability in a reasonable time, compared to the EFV 
program. For example, the restructured EFV Program is scheduled to 
reach Initial Operating Capability (IOC) in 2015; the earliest estimate 
for an alternative program is 2022. Consequently, under scrutiny, the 
EFV Program was certified and restructured to mitigate the risk in 
acquiring the defined capability. As a prudent initiative to further 
address the potential program risks, despite the newly proposed 
timeframe and available resources, the Acquisition Decision Memorandum 
ADM directed the development of an ``alternative way ahead''--a 
contingency plan in order to have an option ``if the risk burn-down 
plan for EFV is not successful.''
    Mr. Forbes. How can the Secretary certify to Congress that no 
alternatives exist to the program, while also requiring the Marine 
Corps to develop a plan for an alternative program should the risk 
mitigation plan fail?
    Mr. Smith. A Nunn-McCurdy certification pertains to the context of 
existing alternatives. Based on the Joint Requirements Oversight 
Committee's affirmation of the need for a high-speed amphibious assault 
capability, Secretary Krieg's decision to certify that no alternatives 
exist included careful consideration of the element of time. That is, 
no alternative program could be executed and deliver the same 
capability in a reasonable time, compared to the current EFV program. 
The restructured EFV Program is scheduled to reach Initial Operating 
Capability in 2015; the earliest estimate for an alternative program is 
2022. Consequently, under scrutiny, the EFV Program was certified and 
restructured to mitigate the risk in acquiring the defined capability. 
As a prudent initiative to further address the potential program risks, 
the Acquisition Decision Memorandum directed the development of an 
``alternative way ahead'' in order to have an option if the risk 
mitigation plan for EFV is not successful. Note that the alternative 
does not propose a completely new vehicle, since much of the design has 
proven to be sound, but addresses the higher risk parts of the program.
    Mr. Forbes. How have the wars in Iraq and Afghanistan changed the 
Marines Corps' plan for providing mobility once Marines get ashore? How 
is the Marine Corps' balancing its two missions of amphibious assaults 
and participation in long-term, irregular warfare?
    General Gardner. Lessons learned from operations in Iraq and 
Afghanistan, past Marine Corps operations, and operations conducted by 
other services and nations, combined with the 2006 Strategic Planning 
Guidance (SPG) tasking the Marine Corps to ``consider an appropriate 
mix of vehicles to support irregular operations'' have shaped our 
tactical ground mobility portfolio. Mobility for Marines ashore will 
continue to be provided by the Marine Air Ground Task Force through air 
and ground systems; however the most significant change in our plan for 
providing future ground mobility stems from force protection 
requirements generated by the current Improvised Explosive Device 
threat. Force protection, amphibious lift and range, night vision, 
speed, adequate firepower, strong reliability, and ease of maintenance 
have always been key characteristics of Marine Corps ground mobility, 
but the level of armored protection required in all future ground 
mobility systems is now a main component driving both operational and 
acquisition planning.
    Amphibious forcible entry operations are maneuver operations where 
lethality and survivability are measured to some extent by our ability 
to disperse or concentrate forces. While ability to maneuver remains a 
factor in irregular operations, two other facets have forced a change 
in requirements placed on Marines and their equipment. First is the 
necessity to maintain proximity with the population. Second, maneuver 
is constrained when Marine forces move into more populated areas where 
their activities, tactics, and vulnerabilities can be discretely 
observed by an enemy who specializes in blending with the population. 
Faced with this new limited ability to maneuver, we found a need to 
adopt tactics and subsequently, reevaluated our vehicle requirements. 
The Marine Corps is balancing our two missions of amphibious assaults 
and participation in long-term, irregular warfare by shifting from a 
largely singular focus on amphibious forcible entry to a mix of 
platforms that have application across the range of military 
operations. We have tailored our Expeditionary Fighting Vehicle 
investment to be consistent with the SPG and have initiated the Marine 
Personnel Carrier and the Joint Light Tactical Vehicle programs, both 
of which seek improved performance and payload while providing vehicle 
occupants with enhanced protection against the ubiquitous threats of 
mines and IEDs that characterize operations where constrained maneuver 
forces us to operate in areas in spite of the known hazards.
    We will continue to pursue a balance of vehicles that will enable 
our Navy-Marine Corps team to increasingly provide a persistent and 
flexible forward presence, both afloat and ashore, to meet combatant 
commanders' growing requirements for general purpose forces. Our future 
mobility systems will enable us to more effectively engage in low-end 
shaping, deterrence, and security missions while also positioning us to 
respond to high-end combat and forcible entry amphibious operations.
    Mr. Forbes. How have the wars in Iraq and Afghanistan changes the 
Marines Corps' plan for providing mobility once Marines get ashore? How 
is the Marine Corps' balancing its two missions of amphibious assaults 
and participation in long-term, irregular warfare?
    Colonel Taylor. Mobility for Marines ashore will continue to be 
provided by the Marine Air Ground Task Force through air and ground 
systems. The 2006 Strategic Planning Guidance (SPG) tasked the Marine 
Corps to ``consider an appropriate mix of vehicles to support irregular 
operations.'' It is that task, combined with lessons learned from 
operations in Iraq and Afghanistan, as well as lessons learned by past 
Marine Corps operations and operations conducted by other services and 
nations, that has served to shape our tactical ground mobility 
portfolio. The largest change in the Marine Corps' plan for providing 
future ground mobility stems from the force protection requirements 
generated by the current Improvised Explosive Device threat. Force 
protection, amphibious lift and range, night vision, speed, adequate 
firepower, strong reliability, and ease of maintenance have always been 
key characteristics of Marine Corps ground mobility; but the level of 
armored protection required in all future ground mobility systems is 
now a main component driving both operational and acquisition planning.
    Amphibious forcible entry operations are maneuver operations where 
lethality and survivability are both measured to some extent by our 
ability to disperse or concentrate our forces. While the ability to 
maneuver remains a factor in irregular operations, two other factors 
influence these operations and force a change in the requirements 
placed on the Marines and their equipment. The first is the necessity 
of proximity. Positively influencing populations require that our 
Marines remain close to that population. In doing so, the second 
factor, constrained maneuver, is introduced. Marine forces move into 
urban areas, or at least those areas that are more populated. In doing 
so, their activities, their tactics, and their vulnerabilities can be 
discretely observed by an enemy who specializes in blending with the 
population. Faced with a limited ability to maneuver, tactics must be 
adopted to changing situations and equipment developed and fielded to 
support forcible entry operations, particularly from the sea, may 
become less suitable when faced with constrained maneuver. It is these 
conditions that caused the Marine Corps to reevaluate its vehicle 
requirements and ultimately caused a shift from a largely singular 
focus on amphibious forcible entry to a mix of platforms that have 
application across the range of military operations. We have tailored 
our Expeditionary Fighting Vehicle investment to be consistent with the 
SPG and we have initiated the Marine Personnel Carrier and the Joint 
Light Tactical Vehicle programs, both of which seek improved 
performance and payload and are planned to provide vehicle occupants 
with enhanced protection against the ubiquitous threats of mines and 
IEDs that characterize operations where constrained maneuver, forces us 
to operate in areas in spite of the known hazards.
    In order to ensure the Marine Corps remains the most ready when the 
nation is least ready, our weapons, vehicles, and aircraft--the tools 
of our trade--must be sufficiently flexible to support operations 
across a wide spectrum of conflict. In the case of ground mobility 
systems, we will continue to pursue a balance of vehicles that will 
enable our Navy-Marine Corps team to increasingly provide a persistent 
and flexible forward presence, both afloat and ashore, to meet the 
combatant commanders' growing requirements for general purpose forces. 
Our future mobility systems will enable us to more effectively engage 
in both low-end shaping, deterrence, and security missions while also 
positioning us to respond to high-end combat and forcible entry 
amphibious operations.

                                  
